G ezto.mheducation.com + 88 M M https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/Wild_MA_8e/wil28773_xappA_A-A16.pdf Homework: Analysis and Excel Simulation Assignment i Saved Help Save & Exit Submit Check my work Use Apple's financial statements in Appendix A to answer the following. Required: 10 1. Using fiscal 2017 as the base year, compute trend percents for fiscal years 2017, 2018, and 2019 for total net sales, total cost of sales, points operating income, other income (expense) net, provision for income taxes, and net income. 2. Compute common-size percents for fiscal years 2018 and 2019 for the following categories of assets: (a) total current assets; (b) property, plant and equipment, net; and (c) accounts receivable, n 3. Using current assets as a percent of total assets to measure liquidity, did Apple's asset makeup become more liquid or less liquid in 2019? Book Complete this question by entering your answers in the tabs below. Print Required 1 Required 2 Required 3 References Using fiscal 2017 as the base year, compute trend percents for fiscal years 2017, 2018, and 2019 for total net sales, total cost of sales, operating income, other income (expense) net, provision for income taxes, and net income. (Input all the values as positive numbers. Enter your answers in millions. Round your percentage answers to 1 decimal place.) Fiscal 2019 Fiscal 2018 Fiscal 2017 Net Sales % % % Cost of sales % % Operating income % % % Other income (expense) % % % Provision for income taxes 1% % Net income % % G ezto.mheducation.com + 88 M M https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/Wild_MA_8e/wil28773_xappA_A-A16.pdf Homework: Analysis and Excel Simulation Assignment i Saved Help Save & Exit Submit Check my work Use Apple's financial statements in Appendix A to answer the following. Required: 10 1. Using fiscal 2017 as the base year, compute trend percents for fiscal years 2017, 2018, and 2019 for total net sales, total cost of sales, points operating income, other income (expense) net, provision for income taxes, and net income. 2. Compute common-size percents for fiscal years 2018 and 2019 for the following categories of assets: (a) total current assets; (b) property, plant and equipment, net; and (c) accounts receivable, n 3. Using current assets as a percent of total assets to measure liquidity, did Apple's asset makeup become more liquid or less liquid in 2019? Book Complete this question by entering your answers in the tabs below. Print Required 1 Required 2 Required 3 References Compute common-size percents for fiscal years 2018 and 2019 for the following categories of assets: (a) total current assets; (b) property, plant and equipment, net; and (c) accounts receivable, net. (Enter your answers in millions. Round your percentage answers to 1 decimal place.) 2019 2018 Total current assets % % Property, plant and equipment, net % 1% Accounts receivable, net |% Mc Graw G ezto.mheducation.com + 88 M M https://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/Wild_MA_8e/wil28773_xappA_A-A16.pdf Homework: Analysis and Excel Simulation Assignment i Saved Help Save & Exit Submit Check my work Use Apple's financial statements in Appendix A to answer the following. Required: 10 1. Using fiscal 2017 as the base year, compute trend percents for fiscal years 2017, 2018, and 2019 for total net sales, total cost of sales, points operating income, other income (expense) net, provision for income taxes, and net income. 2. Compute common-size percents for fiscal years 2018 and 2019 for the following categories of assets: (a) total current assets; (b) property, plant and equipment, net; and (c) accounts receivable, n 3. Using current assets as a percent of total assets to measure liquidity, did Apple's asset makeup become more liquid or less liquid in 2019? Book Complete this question by entering your answers in the tabs below. Print Required 1 Required 2 Required 3 References Using current assets as a percent of total assets to measure liquidity, did Apple's asset makeup become more liquid or less liquid in 2019? Apple's asset makeup become in 2019. Required 2 Required 3 Mc Graw FINAL PAGES aptara| EQA FINAL PAGES aptara EOA Appendix A Financial Statement Information A-1 A-2 Appendix A Financial Statement Information Apple Inc. Apple Inc. CONSOLIDATED BALANCE SHEETS APPLE APPLE CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except number of shares which are reflected in thousands and par value) (In millions, except number of shares which are reflected in thousands and per share amounts) Years ended September 28, 2019 September 29, 2018 September 30, 2017 September 28, 2019 September 29, 2018 Net sales: ASSETS Products 213,883 225,847 196,534 Current assets 25,913 Services 46,291 39.748 32,700 Cash and cash equivalents 48,844 Marketable securities 51,713 0,388 Total net sales 260,174 265,595 229,234 22,926 23.186 Cost of sales: Accounts receivable, net 4.106 Products 144,996 148,164 3,956 126,337 Inventories Services 16,786 15,592 14,711 Vendor non-trade receivables 22,878 25,809 Other current assets 12 ,352 12,087 Total cost of sales 161,782 163,756 141,048 Total current assets 162,819 131,39 Gross margin 98,392 01,839 88,186 Non-current assets Operating expenses: Marketable securities 105,341 16,217 170,199 Research and development 14,236 11,581 18,245 16,705 Property, plant and equipment, net 37,378 41.304 Selling, general and administrative 15,261 Total operating expenses 34,462 26,842 Other non-current assets 32,978 30,941 22,283 Total non-current assets 175,697 63,930 70,898 61,344 34,38 Operating income Other income (expense), net 1,807 2.005 2,745 Total assets 338,516 365,725 Income before provision for income taxes 65,737 72,903 64,089 Provision for income taxes 10,481 13,372 15,738 LIABILITIES AND SHAREHOLDERS' EQUITY Net income $5,256 59,531 48,351 Current liabilities Accounts payable 46,236 55,888 Earnings per share: Other current liabilities 37,720 $3,327 Basic 11.97 12.01 9.27 Deferred revenue 5,522 5.966 Diluted 11.89 11.91 921 Commercial paper 5,980 11,964 Shares used in computing earnings per share: Term debt 10,260 8,784 Basic 4,617,834 4,955,377 5,217,242 Total current liabilities 105,718 115,929 Diluted 4,648,913 5,000 , 109 5 ,251,692 Non-current liabilities See accompanying Notes to Consolidated Financial Statements. Term debt 91,807 93,735 Other non-current liabilities 50,503 48,914 Total non-current liabilities 142,310 42,649 Apple Inc. Total liabilities 248,028 258,578 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Commitments and contingencies (In millions) Shareholders' equity Years ended September 28, 2019 September 29, 2018 September 30, 2017 Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares Net income 55,256 $ 59,531 $ 48.351 authorized; 4,443,236 and 4,754,986 shares issued and outstanding, respectively 45,174 40,201 Other comprehensive income (loss): Retained earnings 45.898 70,400 Change in foreign currency translation, net of tax (408) (525) 224 Accumulated other comprehensive income (loss) (584) 3,454) Change in unrealized gains/losses on derivative instruments, net of tax: Total shareholders' equity 90,488 107,147 Change in fair value of derivatives (661) 523 1,315 Total liabilities and shareholders' equity 338,516 365,725 Adjustment for net (gains) losses realized and included in net income 23 382 1,477) See accompanying Notes to Consolidated Financial Statements. Total change in unrealized gains/losses on derivative instrument ( 638 ) (162) Change in unrealized gains/losses on marketable securities, net of tax: Change in fair value of marketable securities 3,802 (3,407) (782) Adjustment for net (gains) losses realized and included in net income 25 (64 ) Total change in unrealized gains/losses on marketable securities 3,827 (3,406) (846) Total other comprehensive income (loss) 2,781 (3,026) (784 ) Total comprehensive income 58.037 56,505 47,567 See accompanying Notes to Consolidated Financial Statements. wil 47988_appA_A-A16.indd 1 8/22/20 11:45 AM wil47988_appA_A-A16.indd 2 8/22/20 11:45 AMFINAL PAGES aptara| EQA FINAL PAGES aptara EOA Appendix A Financial Statement Information A-3 A-4 Appendix A Financial Statement Information Apple Inc. Apple Inc. APPLE APPLE CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (In millions) Years ended September 28, 2019 September 29, 2018 September 30, 2017 Years ended September 28, 2019 September 29, 2018 September 30, 2017 Total shareholders' equity, beginning balances 107,147 134 ,047 128.249 Cash, cash equivalents and restricted cash, beginning balances 25,913 20,289 20,484 Common stock and additional paid-in capital Operating activities Beginning balances 40.201 35,86 $1,251 Net income 55,256 59,531 48,351 Common stock issued 781 669 555 Adjustments to reconcile net income to cash generated Common stock withheld related to net share settlement of by operating activities: equity awards (2,002) (1,778) (1,468) Depreciation and amortization 12,547 10,903 10,157 Share-based compensation 6,194 5.443 4,909 Share-based compensation expense 6,068 5,340 4.840 Tax benefit from equity awards, including transfer Deferred income tax expense (benefit) (340) (32,590) 5,966 pricing adjustments 620 Other (652) (444) (166) Ending balances 45,174 10,201 35,867 Changes in operating assets and liabilities: Retained earnings Accounts receivable, net 245 (5,322) (2,093) Beginning balances 70,400 18,330 96,364 Inventories (289) 828 (2,723) Net income 55,256 59,531 48,351 Vendor non-trade receivables 2,931 (8,010) (4,254) Dividends and dividend equivalents declared (14,129) (13,735) (12,803 ) Other current and non-current assets 873 (423) (5,318) Common stock withheld related to net share settlement of Accounts payable (1,923) 9,175 8.966 equity awards (1,029 (948) (581) Deferred revenue (625) (3 ) (593) Common stock repurchased (67,101) (73,056) (33,001) Other current and non-current liabilities (4,700) 38.449 1,092 Cumulative effects of changes in accounting principles 2,501 278 Cash generated by operating activities 69,391 77,434 14,22 Ending balances 45,898 70,400 98,330 Investing activities Accumulated other comprehensive income (loss) Purchases of marketable securities (39,630) 71,356) (159,486) Beginning balances (3,454) (150) 634 Proceeds from maturities of marketable securities 40, 102 55,881 31,775 Other comprehensive income (loss) 2.781 (3,026) (784) Proceeds from sales of marketable securities 56,988 47,838 94,564 Cumulative effects of changes in accounting principles 89 (278) Payments for acquisition of property, plant and equipment (10,495) (13,313) (12,451) Ending balances (584) (3,454) (150) Payments made in connection with business acquisitions, net (624) (721) (329) Total shareholders' equity, ending balances 90,488 107,147 34,047 Purchases of non-marketable securities (1,001) (1,871) (521 ) Proceeds from non-marketable securities 1,634 353 126 See accompanying Notes to Consolidated Financial Statements. Other (1,078) (745) (124 ) Cash generated by (used in) investing activities 45,896 16,066 (46,446) Financing activities Proceeds from issuance of common stock 781 669 555 Payments for taxes related to net share settlement of equity awards (2,817) (2,527) (1,874) Payments for dividends and dividend equivalents (14,119) (13,712) (12,769) Repurchases of common stock (66,897) (72,738) 32,900 Proceeds from issuance of term debt, net 6,963 6.969 28,662 Repayments of term debt (8,805) (6,500) (3,500) Proceeds from (Repayments of) commercial paper, net (5,977) (37) 3,852 Other (105) Cash used in financing activities (90,976) (87,876) (17,974) Increase (decrease) in cash, cash equivalents and restricted cash 24,311 5,624 (195) Cash, cash equivalents and restricted cash, ending balances 50,224 25,913 0,289 Supplemental cash flow disclosure: Cash paid for income taxes, net 15,263 $ 10,417 $ 11,591 Cash paid for interest 3,423 3,022 $ 2,092 See accompanying Notes to Consolidated Financial Statements. wil 47988_appA_A-A16.indd 3 8/22/20 11:45 AM wil47988_appA_A-A16.indd 4 8/22/20 11:45 AMFINAL PAGES aptara | EQA FINAL PAGES aptara EOA Appendix A Financial Statement Information A-7 A-8 Appendix A Financial Statement Information Apple Inc. Notes-continued APPLE APPLE Apple Inc. Notes-continued Other Non-Current Liabilities the Company's financial condition and operating results Selected Financial Data combines the watchOS user interface and other technolo $ millions 2019 2018 for that reporting period could be materially adversely af- in millions, except number of shares, which are reflected gies created specifically for a smaller device. In September 2019, the Company introduced Apple Watch Series 5 Long-term taxes payable $29,545 $33,589 fected. In the opinion of management, there was not n thousands, and per share amounts). Other non-current liabilities 20,958 15,325 at least a reasonable possibility the Company may have Services Total other non-current liabilities $50,503 incurred a material loss, or a material loss greater than 2019 a recorded accrual, concerning loss contingencies for Total net sales 2018 2017 2016 2015 $ 260,174 $ 265,595 $ 229,234 $ 215,639 $ 233,715 Digital Content Stores and Streaming Services The asserted legal and other claims, except for the following Net income $ 55,256 $ 59,531 $ 48,351 $ 45,687 $ 53,394 Company operates various platforms that allow customers to Term Debt matters: Earnings per share : discover and download applications and digital content, such . Virnet Basic iOS Performance Management Cases 11.97 $ 12.01 $ 9.27 $ 8.35 $ 9.28 8.31 $ 9.22 as books, music, video, games and podcasts. These platforms As of September 28, 2019, the Company had outstanding floating- and fixed-rate notes with varying maturities for an . Qualcomm French Competition Authority Diluted $ 11.89 $ 11.91 $ 9.21 $ 8 include the App Store, available for iPhone and iPad, the Cash dividends declared per share Mac App Store, the TV App Store and the Watch App Store. aggregate principal amount of $101.7 billion (collectively $ 3.00 $ 2.72 $ 2.40 $ 2.18 $ 1.98 Shares used in The Company also offers subscription-based digital con the "Notes"). The Notes are senior unsecured obligations Disaggregated Revenue by Significant Products and interest is payable in arrears. and Services computing earnings tent streaming services, including Apple Music , which offers The Company recognized $3.2 billion, $3.0 billion and Basic 4.617,834 4,955,377 5,217,242 5,470,820 5,753,421 users a curated listening experience with on-demand radio stations, and Apple TV+, which offers exclusive original con- $2.2 billion of interest cost on its term debt for 2019, 2018 Diluted 4,648,913 5,000,109 5,251,692 5,500,281 5,793,069 Net sales (mil.) tent, and is expected to be available in November 2019. nd 2017, respectively. 2019 2018 2017 Total cash, cash equivalents and AppleCare AppleCare includes AppleCare+ ("AC+") The future principal payments for the Company's Notes iPhone $142,381 $164,888 $139,337 marketable securities $ 205,898 $ 237,100 $ 268,895 $ 237,585 $ 205,666 and the AppleCare Protection Plan, which are fee-based as of September 28, 2019 are as follows (in millions): Mac 25,740 25,198 25,569 Total assets $ 338,516 $ 365,725 $ 375,319 $ 321,686 $ 290,345 services that extend the coverage of phone support eligibility iPad 21,280 18,380 18,802 Non-current portion of term debt $ 91,807 $ 93,735 $ 97,207 $ 75,427 $ 53,329 and hardware repairs. AC+ offers additional coverage for 2020 $ 10,270 Wearables, Home and Accessories 24,482 17,381 12,826 Other non-cu instances of accidental damage and is available in certain 2021 8,750 Services 46.291 39,748 32,700 liabilities $ 50,503 $ 48,914 $ 44,212 $ 39,986 $ 38,104 countries for certain products. Additionally, AC+ with theft 2022 9,528 Total net sales $260.174 $265,595 $229,234 and loss protection is available for iPhone in the U.S. 2023 9,290 iCloud iCloud is the Company's cloud service, 2024 10,039 Company Background which stores music, photos, contacts, calendars, mail, doc- Thereafter 53,802 Reportable segment (mil.) 2 2018 2017 The Company designs, manufactures and markets smart- uments and more, keeping them up-to-date and available Total term debt $101,679 Americas: phones, personal computers, tablets, wearables and acces- across multiple Apple devices and Windows personal computers. Net sales $116,914 $112,093 $96,600 sories, and sells a variety of related services. The As of September 28, 2019 and September 29, 2018, the fair $ 35,099 $30,684 Company's fiscal year is the 52- or 53-week period that Licensing The Company licenses the use of certain of Operating income $ 34,864 its intellectual property, and provides other related services. value of the Company's Notes, based on Level 2 inputs, was Europe: ends on the last Saturday of September. The Company is a California corporation established in 1977 Other Services The Company delivers a variety of $107.5 billion and $103.2 billion, respectively. Net sales $ 60,288 $ 62,420 $54,938 other services available in certain countries, including Operating income $ 19,195 $ 19.955 $16,514 Products Apple Arcade", a game subscription service; Apple Share Repurchase Program Greater China: Net sales $ 51,942 $44,764 iPhone iPhone is the Company's line of smartphones Card , a co-branded credit card; Apple News+, a sub- $ 43,678 based on its iOS operating system. In September 2019, the scription news and magazine service; and Apple Pay, a On April 30, 2019, the Company announced the Board Operating income $ 16,232 $ 19,742 $17,032 of Directors increased the current share repurchase pro Company introduced three new iPhones: iPhone 11, iPhone cashless payment service. gram authorization from $100 billion to $175 billion of Japan: 1 1 Pro and iPhone 11 Pro Max. $ 21,506 $ 21,733 $17,733 Markets and Distribution the Company's common stock, of which $96.1 billion Net sales Mac Macis the Company's line of personal comput- $ 9,500 $ 8.097 ers based on its macOS operating system. During 2019, The Company's customers are primarily in the consumer, had been utilized as of September 28, 2019. During Operating income $ 9.369 2019, the Company repurchased 345.2 million shares of Rest of Asia Pacific: the Company released a new version of MacBook Air and small and mid-sized business, education, enterprise and gov- its common stock for $67.1 billion, including 62.0 mil- Net sales $ 17,788 $ 17,407 $15,199 a new Mac mini, and introduced an updated Mac Pro, ernment markets. The Company sells its products and resells Operating income $ 6,055 $ 6,181 $ 5,304 which is expected to be available in the fall of 2019. third-party products in most of its major markets directly to lion shares delivered under a $12.0 billion accelerated consumers, small and mid-sized businesses, and education, share repurchase arrangement dated February 2019, iPad iPad is the Company's line of multi-purpose tab- which settled in August 2019. The Company's share re- lets. iPad is based on the Company's iPadOS" operating sys- enterprise and government customers through its retail and purchase program does not obligate it to acquire any spe- A reconciliation of the Company's segment operating tem, which was introduced during 2019. Also during 2019, online stores and its direct sales force. The Company also employs a variety of indirect distribution channels, such as cific number of shares. income to the Consolidated Statements of Operations for he Company released two new versions of iPad Pro, an 2019, 2018 and 2017 is as follows: Pad Air, an updated iPad mini and a new 10.2-inch iPad. third-party cellular network carriers, wholesalers, retailers Wearables, Home and Accessories Wearables, Home and resellers. During 2019, the Company's net sales through Contingencies $ millions 2019 2018 and Accessories includes AirPods, Apple TV, Apple its direct and indirect distribution channels accounted for 2017 The Company is subject to various legal proceedings and Segment operating income $ 85,950 $ 90,242 $77,631 Watch, Beats products, HomePod", ipod touch and 31% and 69%, respectively, of total net sales. claims that have arisen in the ordinary course of business other Apple-branded and third-party accessories. AirPods and that have not been fully resolved. The outcome of Research and development are the Company's wireless headphones that interact with Employees expense (16,217) (14,236) (11,581) litigation is inherently uncertain. If one or more legal Other corporate expenses, net (5,803) (5,108) (4,706) Siri. In October 2019, the Company introduced AirPods As of September 28, 2019, the Company had approximately matters were resolved against the Company in a report- Total operating income $ 63,930 $ 70,898 $61,344 Pro". Apple Watch is a personal electronic device that 137,000 full-time equivalent employees. ing period for amounts above management's expectations, wil47988_appA_A-A16.indd 7 8/22/20 11:45 AM wil47988_appA_A-A16.indd 8 8/22/20 11:45 AM