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Sun Microsystems is a leading supplier of computer-related products, including servers, workstations, storage devices, and network switches. In 2009, Sun Microsystems was acquired by Oracle

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Sun Microsystems is a leading supplier of computer-related products, including servers, workstations, storage devices, and network switches. In 2009, Sun Microsystems was acquired by Oracle Corporation In the letter to stockholders as part of the 2001 annual report, President and CEO Scott G.McNealy offered the following remarks: Fiscal 2001 was clearly a mixed bag for Sun, the industry, and the economy as a whole. Still, we finished with revenue growth of 16 percent and that's significant. We believe it's a good indication that Sun continued to pull away from the pack and gain market share. For that, we owe a debt of gratitude to our employees worldwide, who aggressively brought costs down even as they continued to bring exciting new products to market. The statement would not appear to be telling you enough. For example, McNealy says the year was a mixed bag with revenue growth of 16 percent. But what about earnings? You can delve further by examining the income statement in Exhibit 4. Also, for additional analysis of other factors, consolidated balance sheet(s) are presented in Exhibit 5. Exhibit 1 2001 Dollars 2000 Dollars 1999 1998 Dollars Dollars $ $ 9,865 11,804 Net revenues $ 18,550 $ 15,726 $10.044 2.011 $7543 55.675 54.645 1.626 1,273 1,034 4,547 4,069 3,188 2,836 Costs and expenses: Cost of sales Research and development Selling, general and administrative Goodwill amortization In-process research and development Total costs and expenses Operating Income 260 111171 $ 16,942 8633 $ 13,3125 10,272 32414 $1,532 $ 1,608 1,171.7 $-94 $ 2061 Gain (loss) on strategic investments Interest income, net Litigation settlement Income before taxes $362 $ 170 $86 $ 48 $ 1,876 $ 2.790 $ 1,618 1.219.7 $969. 12 5 699.6 $4262 $ 1,004.9 Provision for income taxes Cumulative effect of change in accounting principle, net Net income Net Income per common share- $ 926.11 $0.27 $ 1820 88 $918.4 $ 793.5 $0.54 $0.28 $0.25 biluted Shares used in the calculation of net income per common share-diluted Exhibit 2 S1479 2851 1041 Assets Current assets Cash and cash equivalents Short term investments Accounts receivable, not allowances of $410 in b001 and in 2000 inventories Deferred tax assets Prepaids and other current assets Total current assets Property plant and equipment ne Long term investments Goodwil net of accumulated amortization 549 in b001 and in 2000 Other assets net 974 20 2,040 180 928 1.042 087 13751 1830 751 1 290 212 205 4.546 571 1711 1,690 Tabilities and Stockholders' Equity Current abities Short-term borrowings Accounts payable Accrued payroll related abilities Accrued labies and other Deferred revenues and customer deposits Warranty reserve income taxes payable Total current liabilities Deferred income taxes Long-term debt and other obligations Get Commitments and contingencies Stockholders' equity Preferred to par value. 10 Shares authored (1 sare which has been designated as Series A Preferred participating stock no shares issued and outstanding Common stock and additional paid-in-capital 50 00057 par value, 7 200 shares authorised issued 3,536 shares in 2001 and 301 shares in 2000 treasury stock, a cost283 shares in 2001 and 301 shares in 2000 Deferred equity compensation Retained earnings Accumulated other comprehensive income LOSS) Total stockholders equity 6,507 10,512 729 14,127 TO Part A Referring to Exhibit 1. compute the annual percentage change in net income per common share-diluted (second numerical line from the bottom) for 1998-1999, 1999-2000, and 2000-2001

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