Exhibit 3

Explain the changes to Apple's 2008 and 2009 Balance sheets and its 2007, 2008, and 2009 income statements (Exhibit 3). Do the restated financial statements better reflects Apple's financial condition?

EXHIBIT 3 NOTE 2 APPLE 2009 10-KA Note 2-Retrospective Adoption of New Accounting Principles In September 2009, the FASB amended the accounting standards related to revenue recognition for arrangements with multiple deliverables and arrangements that include software elements. In the first quarter of 2010, the Company adopted the new accounting principles on a retrospective basis. The Company believes retrospective adoption provides the most comparable and useful financial information for financial statement users, is more consistent with the information the Company's management uses to evaluate its business, and better reflects the underlying economic performance of the Company. The financial statements and notes to the financial statements presented herein have been adjusted to reflect the retrospective adoption of the new accounting principles. Note 1, "Summary of Significant Accounting Policies" under the subheadings "Basis of Presentation and Preparation" and "Revenue Recognition" of this form 10-K provides additional information on the Company's change in accounting resulting from the adoption of the new accounting principles and the Company's revenue recognition accounting policy. (continued) SECTION FINE FINANCIAL STATEMENT ANYS principles to the Company's previously reported Consolidated Balance Sheets as of The following tables present the effects of the retrospective adoption of the new according September 26, 2009 and September 27, 2008 in illons, except share amounts AN KA September 26, 2009 As Reported Adjustments As Amendet 55.253 55.263 18,201 3,361 455 2.101 6.884 3.361 * 1.135 Curent assets Cast and cash equivalents Short-term marketable securities Accounts receivable less allowance of 552 Inertones Deferred tax assets Other current assets Total current assets Long-termarketable securities Property, plant and equipment, net Good Acoured intangible assets, net Other assets (966) (3.744) (4.710) 3.13 36.265 10,528 2.954 206 31.555 12528 247 3,651 2013 (1.640) $(6.350) $53,851 5- $5.502 $5,601 3.376 10,305 19.282 4,485 2,252 Total assets Current Eat ties Accounts payable Acoued expenses Deferred revenue Total current liabilities Deferred revenue-non-current Other non-current liabilities Total abilities Commitments and contingencies Shareholders equity Common stock, no par value; 1,800,000,000 shares authorized: 899,805,500 shares issued and outstanding Retained earnings Accumulated other comprehensive income Total shareholders equity Total liabilities and shareholders' equity (8.252) (1.776) (3,632) 1.250 (10.158) 3.502 26,019 8210 8,210 19,538 3,815 23.3353 17 84 27,832 3.808 $53,851 $(6,350) APPLE INC. AND RETROSPECTIVE ADOPTION OF REVENUE RECOGNITION RULES CASE 5.3 389 September 27, 2008 As Reported Adjustments As Amended EXHIBIT 3- continued Nove 2. Appu. 2009 10-KIN $11,875 10,236 Current assets: Cash and cash equivalents Short-term marketable securities Accounts receivable, less allowance of $47 Inventories Deferred tax assets Other current assets $11,875 10,236 2,422 509 1,447 5,822 (403) (1,902) (2,305) 2,422 509 1,044 3,920 32,311 2,379 2,455 207 Total current assets Long-term marketable securities Property, plant and equipment, net Goodwill Acquired intangible assets, net Other assets 30,006 2,379 2,455 285 1,935 207 285 839 (1,096) $(3,401) $39,572 $36,171 Total assets $5,520 3,719 4,853 $5,520 4,224 1,617 $- 505 (3,236) (2,731) (2,261) 324 11,361 14,092 3,029 1,421 768 1,745 13,874 18,542 (4,668) Current liabilities: Accounts payable Accrued expenses Deferred revenue Total current liabilities Deferred revenue-non-current Other non-current liabilities Total liabilities Commitments and contingencies Shareholders' equity: Common stock, no par value; 1,800,000,000 shares authorized; 888,325,973 shares issued and outstanding Retained earnings Accumulated other comprehensive income/(loss) Total shareholders' equity Total liabilities and shareholders' equity - 1 1,284 7,177 13,845 8 7,177 15,129 (9) 22,297 (17) 1,267 $(3,401) $36,171 21,030 $39,572 (continued) FINANCIAL STATEMENT ANALYSIS SECTION FIVE accounting nd APPLE INC. -KA principles to the Company's previously reported Consolidated Statements of Operations for the The following tables present the effects of the retrospective adoption of the new years ended September 26, 2009, September 27, 2008, and September 29, 2007 (in millions, except share amounts): Fiscal Year Ended September 26, 2009 As Reported Adjustments As Amended $36,537 $6,368 23,397 2,286 4,082 Net sales Cost of sales $42,905 25,683 17,222 13,140 1,333 4,149 1,333 4,149 5,482 7,658 4,082 5,482 11,740 326 326 Gross margin Operating expenses: Research and development Selling, general and administrative Total operating expenses Operating income Other income and expense Income before provision for income taxes Provision for income taxes Net Earnings per common share: Basic Diluted 7,984 4,082 12,066 2,280 1,551 3,831 $5,704 $2,531 $8,235 $6.39 $6.29 $2.83 $2.79 $9.22 $9.08 Shares used in computing earnings per share: Basic Diluted 893,016 907,005 893,016 907,00 (continued) APPLE INC. AND RETROSPECTIVE ADOPTION OF REVENUE RECOGNITION RULES CASE 5.3 391 Fiscal Year Ended September 27, 2008 As Reported Adjustments As Amended $5,012 2,960 2,052 13,197 $32,479 21,334 EXHIBIT 3- continued Note 2. App 279 -KIN Net sales Cost of sales $37,491 24,294 11,145 1,109 3,761 1,109 3,761 4,870 Gross margin Operating expenses: Research and development Selling, general and administrative Total operating expenses Operating income Other income and expense Income before provision for income taxes Provision for income taxes Net income 4,870 6,275 620 2,052 8,327 620 2,052 6,895 2,061 $4,834 767 8,947 2,828 $1,285 $6,119 $5.48 $5.36 $1.46 $1.42 $6.94 $6.78 Earnings per common share: Basic Diluted Shares used in computing earnings per share: Basic Diluted 881,592 902,139 881,592 902,139 - (continued) FINANCIAL STATEMENT ANALYSIS SECTION FIVE 22 Fiscal Year Ended September 29, 2007 As Reported Adjustments As Amended $24,006 $572 15,852 574 8,154 (2) 8,152 $24,578 16,426 782 2,963 782 2,963 3,745 KHIBIT 3- ontinued OTE 2, APPLE INC. 009 10-KA Net sales Cost of sales Gross margin Operating expenses: Research and development Selling, general and administrative Total operating expenses Operating income Other income and expense Income before provision for income taxes Provision for income taxes Net income Earnings per common share: (2) 3,745 4,409 599 5,008 1,512 $3,496 4,407 599 5,006 (2) (1) $(1) 1,511 $3,495 $4.04 $3.93 $- $- $4.04 $3.93 Basic Diluted Shares used in computing earnings per share: Basic Diluted 864,595 889,292 TI 864,595 889,292