Review Starbucks's 2017 financial statements and:
a. Does the company use a multi-step or a single-step format on the income statement? explain.
b. what was the net earnings attributable to Starbucks for 2017? what was the basic earnings per common share for 2017?
c. what was the amount of income taxes related to income before taxes for 2017?
d. what was the amount of general and administrative expenses?
e. What amount of depreciation and amortization expenses is reported separately on the income statement for 2017? how much depreciation and amortization expense is added back to the net income on the 2017 statement of cash flows? what item on the income statement includes the majority of the difference?
f. what amount of dividends on common stock was paid and declared in 2017? if these amounts differ where is the difference on the balance sheet?
g. are Starbucks's revenues seasonal? if so, in which two quarters did Starbucks generate the most revenues for 2016 and 2017?
h. did Starbucks use the direct or indirect method to determine the net cash provided by operating activities in 2017? what was the amount?
i. what was the cash used in investing activities in 2017?
j. what cash was used for financial activities in 2017?
STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS (in millions, except per share data) $ $ 17,650.7 2.355.0 2,381.1 22,386,8 9,038.2 6,493.3 553.8 1,011.4 1.393.3 153.5 18,643.5 391.4 4.134.7 16,844.1 2,154.2 2,317,6 21,315,9 8,511.1 6,064.3 545.4 980.8 1,360.6 Fiscal Year Ended Net revenues: Company-operated stores Licensed stores CPG, foodservice and other Total net revenues Cost of sales including occupancy costs Store operating expenses Other operating expenses Depreciation and amortization expenses General and administrative expenses Restructuring and impairments Total operating expenses Income from equity investees Operating income Gain resulting from acquisition of joint venture Loss on extinguishment of debt Interest income and other, net Interest expense Earnings before income taxes Income tax expense Net earnings including noncontrolling interests Net earnings attributable to noncontrolling interests Net carnings attributable to Starbucks Earnings per share-basic Earnings per share-diluted Weighted average shares outstanding: Basic Diluted 15,197.3 1.861.9 2,103,5 19,162.7 7,787.5 5,411.1 522.4 893.9 1.196.7 17.462.2 3182 4.171.9 15.811.6 249.9 3,601.0 390,6 275.3 (92.5) 4.317.5 1.432.6 2.884.9 0.2 2.884.7 $ 1.99 $ 1.97 $ 108.0 (81.3) 4.1986 1.379.7 2.818.9 1.2 (61.1) 43.0 (70.5) 3.903.0 1.143.7 2,759.3 1.9 2.757.4 1.84 182 2.817.7 $ 1.91 1.90 $ $ 1,449.5 1.461.5 1,471.6 1.486.7 1.495.9 1,513.4 See Notes to Consolidated Financial Statements STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME in millions) $ 2.884.9 $ 2.818.9 $ 2.759.3 3.5 (1.3) (109.6) 27.5 Fiscal Year Ended Net earnings including noncontrolling interests Other comprehensive income/loss), net of tax: Unrealized holding gains/(losses) on available-for-sale securities Tax (expense benefit Unrealized gains/(losses) on cash flow hedging instruments Tax (expense) benefit Unrealized gains/(losses) on net investment hedging instruments Tax (expense) benefit Translation adjustment and other Tax (expense)/benefit Reclassification adjustment for net (gains) losses realized in net earnings for available-for-sale securities, hedging instruments, and translation adjustment Tax expense/(benefit) Other comprehensive income/(loss) Comprehensive income including noncontrolling interests Comprehensive income/(loss) attributable to noncontrolling interests Comprehensive income attributable to Starbucks (9.5) 2.9 53.2 (12.6) 20.1 (7.4) (38.3) (2.4) (0.5) 47.6 (16.8) 4.3 (1.6) (222.7) 6.0 19.0 (67.2) 14.0 (47.2) 2,837.7 0.2 2.837.5 $ 78.2 (11.8) 91.0 2.909.9 1.2 2.908.7 $ (65.9) 23.5 (224.7) 2,534.6 (29.2) 2,563.8 $ See Notes to Consolidated Financial Statements. STARBUCKS CORPORATION CONSOLIDATED BALANCE SHEETS fin millions, except per share data) S 2.462.3 2286 870.4 1.364.0 358.1 5.283.4 542.3 481.6 4.919.5 795.4 362.8 441.4 1.539.2 14,365,6 2.128.8 134.4 768,8 1,378,5 347.4 4.757.9 1,141.7 354.5 4.533.8 885.4 403.3 516.3 1.719.6 14.312.5 $ $ ASSETS Current assets: Cash and cash equivalents Short-term investments Accounts receivable, net Inventories Prepaid expenses and other current assets Total current assets Long-term investments Equity and cost investments Property, plant and equipment, net Deferred income taxes, net Other long-term assets Other intangible assets Goodwill TOTAL ASSETS LIABILITIES AND EQUITY Current liabilities Accounts payable Accrued liabilities Insurance reserves Stored value card liability Current portion of long-term debt Total current liabilities Long-term debt Other long-term liabilities Total liabilities Shareholders' equity: Common stock ($0.001 par value) - authorized, 2,400.0 shares; issued and outstanding, 1,431.6 and 1.460.5 shares, respectively Additional paid-in capital Retained earnings Accumulated other comprehensive loss Total shareholders' equity Noncontrolling interests Total equity TOTAL LIABILITIES AND EQUITY $ $ 782.5 1.934.5 215.2 1.288.5 730.6 1.999.1 246,0 1.171.2 399.9 4.546,8 3.185.3 689.7 8.421.8 4.220.7 3.932.6 755.3 8,908.6 41.1 5,563.2 (155.6) 15 41.1 5.949.8 (108.4) 5.884.0 5,450.1 6,9 6,7 5,457.0 14,365,6 5,890.7 14.312.5 $ See Notes to Consolidated Financial Statements STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Oct 2. 2016 Sep 27. 2015 $ 2.818.9 $ 2.759.3 1,030.1 265.7 (250.2) 223.3 933.8 21.2 (190.2) 148,2 (6.1) (394.3) 61.1 209.8 (132.4) 218.1 (122.8) 45.1 53,8 (55.6) (67.5) 46.9 180.4 248.8 4,575.1 (82.8) (207.9) 137.7 170.3 2615 3,749.1 (1,585.7) 680.7 27.9 Oct 1, Fiscal Year Ended 2017 OPERATING ACTIVITIES: Net earnings including noncontrolling interests $ 2,884,9 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 1,067.1 Deferred income taxes, net 95.1 Income earned from equity method investees (310.2) Distributions received from equity method investees 186,6 Gain resulting from acquisition sale of equity in joint ventures and certain retail operations (93.5) Loss on extinguishment of debt Stock-based compensation 176.0 Excess tax benefit on share-based awards (77.5) Goodwill Impairments 87.2 Other 68.9 Cash provided by changes in operating assets and liabilities: Accounts receivable (96.8) Inventories 14.0 Accounts payable 46.4 Stored value card liability 130.8 Other operating assets and liabilities (4.7) Net cash provided by operating activities 4.1 74.3 INVESTING ACTIVITIES: Purchases of investments (674.4) Sales of investments 1,054.5 Maturities and calls of investments 149.6 Acquisitions, net of cash acquired Additions to property, plant and equipment (1,519.4) Net proceeds from sale of equity in joint ventures and certain retail operations 85.4 Other Net cash used by investing activities (850.0) FINANCING ACTIVITIES: Proceeds from issuance of long-term debt 750.2 Repayments of long-term debt (400.0) Cash used for purchase of non-controlling interest Proceeds from issuance of common stock 150,8 Excess tax benefit on share-based awards 77.5 Cash dividends paid (1,450,4) Repurchase of common stock (2,042.5) Minimum tax withholdings on share-based awards (82.8) Other (4.4) Net cash used by financing activities (3,001.6) Effect of exchange rate changes on cash and cash equivalents 10.8 Net increase/(decrease) in cash and cash equivalents 333.5 CASH AND CASH EQUIVALENTS: Beginning of period 2.128,8 End of period $ 2.462.3 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Interest, net of capitalized interest $ 96,6 Income taxes, net of refunds $ 1,389.1 See Notes to Consolidated Financial Statements (567.4) 600.6 18.8 (284.3) (1,303.7) 8,9 6.8 (1,520.3) (1,440.3) 69.6 24.9 (2.222.9) 54.3 1,254.5 160.7 122.8 (1,178,0) (1,995.6) (106.0) (8.4) (1,750.0) (3.5) 598.7 848.5 (610.1) (360.8) 191.8 132.4 (928.6) (1.436.1) (75.5) (18.1) (2.256,5) (1506) (178.3) 1 $ 1.530. 1 2.128.8 $ .708.4 1.530.1 $ $ 74.7 878.7 $ $ 69.5 1,072.2 50 STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF EQUITY in millions, except per share data) Common Stock Starbucks Corporation Shares 749.5 Amount 0.7 Additional Paid in Capital S 39. 4 Accumulated Other Comprehensive Income/(Loss) 5 25.3 Retained Earnings 5 5.206.6 2,757.4 $ Shareholders Equity S 5.272.0 2,757.4 (193.6) 211.7 Noncontrolling Interests S 1.7 1.9 (31.1) S Total 5.273.7 2.759.3 (224.7) 211.7 (193.6) 211.7 2017 Form 10-K 14.6 0.6 (29.0) 224.4 23.5 (459.6) 224.4 23.5 (1,431.8) (1,016.2) 224.4 23.5 (1.431.8) (1,016.2) (972.2) (1,016.2) (0.8) 749.4 0.8 411.1 (381.7) 1.8 1.7 411 S 1,485.151.5 5,974. 85 S 5 Balance, September 28, 2014 Net earnings/(loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $131.3 Sale of common stock, including tax benefit of S02 Repurchase of common stock Cash dividends declared, S0.680 per share Two-for-one stock split Noncontrolling interest resulting from acquisition Purchase of noncontrolling interest Balance, September 27, 2015 Net earnings (loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $124.3 Sale of common stock, including tax benefit of $0.2 Repurchase of common stock Cash dividends declared. S0.850 per share Noncontrolling interest resulting from acquisition Balance, October 2, 2016 Net earnings (loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $77.4 2,817.7 411.1 (411.1) 5.819.8 2.818.9 91.0 219.6 (29.4) 5,818.0 2.817.7 91.0 219.6 91.0 219.6 9.8 0.5 (34.9) 153.0 26.5 (399.1) 153.0 26.5 (1.995.6) (1.246.2) (1.596.5) (1.246.2) 153.0 26.5 (1.995.6) (1.246.2) 3.7 5.890.7 2.884.9 (47.2) 177.9 1,460.5 5 155 415 5.949.8 5 (108.4) 3 5 2.884.7 5,884,0 2.884.7 (47.2) 177.9 (47.2) 177.9 117.0 117.0 117.0 0.5 (37.5) 28.7 (323.6) (0.1) Sale of common stock, including tax benefit of $0.2 Repurchase of common stock Cash dividends declared, $1.05 per share Balance, October 1, 2017 (1.755.4) (1.515.9) 5 ,563.2 28.7 12.079.1) (1,515.9) 5,450.1 5 28.7 (2,079.1) (1.515.9) . 95 5.457.0 1,431.6 5 1. 45 4 1.1 5 (155.6) S 6 See Notes to Consolidated Financial Statements. STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS (in millions, except per share data) $ $ 17,650.7 2.355.0 2,381.1 22,386,8 9,038.2 6,493.3 553.8 1,011.4 1.393.3 153.5 18,643.5 391.4 4.134.7 16,844.1 2,154.2 2,317,6 21,315,9 8,511.1 6,064.3 545.4 980.8 1,360.6 Fiscal Year Ended Net revenues: Company-operated stores Licensed stores CPG, foodservice and other Total net revenues Cost of sales including occupancy costs Store operating expenses Other operating expenses Depreciation and amortization expenses General and administrative expenses Restructuring and impairments Total operating expenses Income from equity investees Operating income Gain resulting from acquisition of joint venture Loss on extinguishment of debt Interest income and other, net Interest expense Earnings before income taxes Income tax expense Net earnings including noncontrolling interests Net earnings attributable to noncontrolling interests Net carnings attributable to Starbucks Earnings per share-basic Earnings per share-diluted Weighted average shares outstanding: Basic Diluted 15,197.3 1.861.9 2,103,5 19,162.7 7,787.5 5,411.1 522.4 893.9 1.196.7 17.462.2 3182 4.171.9 15.811.6 249.9 3,601.0 390,6 275.3 (92.5) 4.317.5 1.432.6 2.884.9 0.2 2.884.7 $ 1.99 $ 1.97 $ 108.0 (81.3) 4.1986 1.379.7 2.818.9 1.2 (61.1) 43.0 (70.5) 3.903.0 1.143.7 2,759.3 1.9 2.757.4 1.84 182 2.817.7 $ 1.91 1.90 $ $ 1,449.5 1.461.5 1,471.6 1.486.7 1.495.9 1,513.4 See Notes to Consolidated Financial Statements STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME in millions) $ 2.884.9 $ 2.818.9 $ 2.759.3 3.5 (1.3) (109.6) 27.5 Fiscal Year Ended Net earnings including noncontrolling interests Other comprehensive income/loss), net of tax: Unrealized holding gains/(losses) on available-for-sale securities Tax (expense benefit Unrealized gains/(losses) on cash flow hedging instruments Tax (expense) benefit Unrealized gains/(losses) on net investment hedging instruments Tax (expense) benefit Translation adjustment and other Tax (expense)/benefit Reclassification adjustment for net (gains) losses realized in net earnings for available-for-sale securities, hedging instruments, and translation adjustment Tax expense/(benefit) Other comprehensive income/(loss) Comprehensive income including noncontrolling interests Comprehensive income/(loss) attributable to noncontrolling interests Comprehensive income attributable to Starbucks (9.5) 2.9 53.2 (12.6) 20.1 (7.4) (38.3) (2.4) (0.5) 47.6 (16.8) 4.3 (1.6) (222.7) 6.0 19.0 (67.2) 14.0 (47.2) 2,837.7 0.2 2.837.5 $ 78.2 (11.8) 91.0 2.909.9 1.2 2.908.7 $ (65.9) 23.5 (224.7) 2,534.6 (29.2) 2,563.8 $ See Notes to Consolidated Financial Statements. STARBUCKS CORPORATION CONSOLIDATED BALANCE SHEETS fin millions, except per share data) S 2.462.3 2286 870.4 1.364.0 358.1 5.283.4 542.3 481.6 4.919.5 795.4 362.8 441.4 1.539.2 14,365,6 2.128.8 134.4 768,8 1,378,5 347.4 4.757.9 1,141.7 354.5 4.533.8 885.4 403.3 516.3 1.719.6 14.312.5 $ $ ASSETS Current assets: Cash and cash equivalents Short-term investments Accounts receivable, net Inventories Prepaid expenses and other current assets Total current assets Long-term investments Equity and cost investments Property, plant and equipment, net Deferred income taxes, net Other long-term assets Other intangible assets Goodwill TOTAL ASSETS LIABILITIES AND EQUITY Current liabilities Accounts payable Accrued liabilities Insurance reserves Stored value card liability Current portion of long-term debt Total current liabilities Long-term debt Other long-term liabilities Total liabilities Shareholders' equity: Common stock ($0.001 par value) - authorized, 2,400.0 shares; issued and outstanding, 1,431.6 and 1.460.5 shares, respectively Additional paid-in capital Retained earnings Accumulated other comprehensive loss Total shareholders' equity Noncontrolling interests Total equity TOTAL LIABILITIES AND EQUITY $ $ 782.5 1.934.5 215.2 1.288.5 730.6 1.999.1 246,0 1.171.2 399.9 4.546,8 3.185.3 689.7 8.421.8 4.220.7 3.932.6 755.3 8,908.6 41.1 5,563.2 (155.6) 15 41.1 5.949.8 (108.4) 5.884.0 5,450.1 6,9 6,7 5,457.0 14,365,6 5,890.7 14.312.5 $ See Notes to Consolidated Financial Statements STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Oct 2. 2016 Sep 27. 2015 $ 2.818.9 $ 2.759.3 1,030.1 265.7 (250.2) 223.3 933.8 21.2 (190.2) 148,2 (6.1) (394.3) 61.1 209.8 (132.4) 218.1 (122.8) 45.1 53,8 (55.6) (67.5) 46.9 180.4 248.8 4,575.1 (82.8) (207.9) 137.7 170.3 2615 3,749.1 (1,585.7) 680.7 27.9 Oct 1, Fiscal Year Ended 2017 OPERATING ACTIVITIES: Net earnings including noncontrolling interests $ 2,884,9 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 1,067.1 Deferred income taxes, net 95.1 Income earned from equity method investees (310.2) Distributions received from equity method investees 186,6 Gain resulting from acquisition sale of equity in joint ventures and certain retail operations (93.5) Loss on extinguishment of debt Stock-based compensation 176.0 Excess tax benefit on share-based awards (77.5) Goodwill Impairments 87.2 Other 68.9 Cash provided by changes in operating assets and liabilities: Accounts receivable (96.8) Inventories 14.0 Accounts payable 46.4 Stored value card liability 130.8 Other operating assets and liabilities (4.7) Net cash provided by operating activities 4.1 74.3 INVESTING ACTIVITIES: Purchases of investments (674.4) Sales of investments 1,054.5 Maturities and calls of investments 149.6 Acquisitions, net of cash acquired Additions to property, plant and equipment (1,519.4) Net proceeds from sale of equity in joint ventures and certain retail operations 85.4 Other Net cash used by investing activities (850.0) FINANCING ACTIVITIES: Proceeds from issuance of long-term debt 750.2 Repayments of long-term debt (400.0) Cash used for purchase of non-controlling interest Proceeds from issuance of common stock 150,8 Excess tax benefit on share-based awards 77.5 Cash dividends paid (1,450,4) Repurchase of common stock (2,042.5) Minimum tax withholdings on share-based awards (82.8) Other (4.4) Net cash used by financing activities (3,001.6) Effect of exchange rate changes on cash and cash equivalents 10.8 Net increase/(decrease) in cash and cash equivalents 333.5 CASH AND CASH EQUIVALENTS: Beginning of period 2.128,8 End of period $ 2.462.3 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Interest, net of capitalized interest $ 96,6 Income taxes, net of refunds $ 1,389.1 See Notes to Consolidated Financial Statements (567.4) 600.6 18.8 (284.3) (1,303.7) 8,9 6.8 (1,520.3) (1,440.3) 69.6 24.9 (2.222.9) 54.3 1,254.5 160.7 122.8 (1,178,0) (1,995.6) (106.0) (8.4) (1,750.0) (3.5) 598.7 848.5 (610.1) (360.8) 191.8 132.4 (928.6) (1.436.1) (75.5) (18.1) (2.256,5) (1506) (178.3) 1 $ 1.530. 1 2.128.8 $ .708.4 1.530.1 $ $ 74.7 878.7 $ $ 69.5 1,072.2 50 STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF EQUITY in millions, except per share data) Common Stock Starbucks Corporation Shares 749.5 Amount 0.7 Additional Paid in Capital S 39. 4 Accumulated Other Comprehensive Income/(Loss) 5 25.3 Retained Earnings 5 5.206.6 2,757.4 $ Shareholders Equity S 5.272.0 2,757.4 (193.6) 211.7 Noncontrolling Interests S 1.7 1.9 (31.1) S Total 5.273.7 2.759.3 (224.7) 211.7 (193.6) 211.7 2017 Form 10-K 14.6 0.6 (29.0) 224.4 23.5 (459.6) 224.4 23.5 (1,431.8) (1,016.2) 224.4 23.5 (1.431.8) (1,016.2) (972.2) (1,016.2) (0.8) 749.4 0.8 411.1 (381.7) 1.8 1.7 411 S 1,485.151.5 5,974. 85 S 5 Balance, September 28, 2014 Net earnings/(loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $131.3 Sale of common stock, including tax benefit of S02 Repurchase of common stock Cash dividends declared, S0.680 per share Two-for-one stock split Noncontrolling interest resulting from acquisition Purchase of noncontrolling interest Balance, September 27, 2015 Net earnings (loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $124.3 Sale of common stock, including tax benefit of $0.2 Repurchase of common stock Cash dividends declared. S0.850 per share Noncontrolling interest resulting from acquisition Balance, October 2, 2016 Net earnings (loss) Other comprehensive income (loss) Stock-based compensation expense Exercise of stock options/vesting of RSUS. including tax benefit of $77.4 2,817.7 411.1 (411.1) 5.819.8 2.818.9 91.0 219.6 (29.4) 5,818.0 2.817.7 91.0 219.6 91.0 219.6 9.8 0.5 (34.9) 153.0 26.5 (399.1) 153.0 26.5 (1.995.6) (1.246.2) (1.596.5) (1.246.2) 153.0 26.5 (1.995.6) (1.246.2) 3.7 5.890.7 2.884.9 (47.2) 177.9 1,460.5 5 155 415 5.949.8 5 (108.4) 3 5 2.884.7 5,884,0 2.884.7 (47.2) 177.9 (47.2) 177.9 117.0 117.0 117.0 0.5 (37.5) 28.7 (323.6) (0.1) Sale of common stock, including tax benefit of $0.2 Repurchase of common stock Cash dividends declared, $1.05 per share Balance, October 1, 2017 (1.755.4) (1.515.9) 5 ,563.2 28.7 12.079.1) (1,515.9) 5,450.1 5 28.7 (2,079.1) (1.515.9) . 95 5.457.0 1,431.6 5 1. 45 4 1.1 5 (155.6) S 6 See Notes to Consolidated Financial Statements
