Review the balance sheet and income statement

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Reference no: EM13327084

Review the balance sheet and income statement of your company. Answer questions below.

• Stockholder's Equity - what type of stock does your company issue (par value, no par, etc.)? Does it issue Preferred Stock? Does it hold any Treasury Stock?

• Dividends - does your company pay dividends? If so, please comment.

• Liabilities - does your company have any long-term liabilities? If so, please comment.

• Investments - does your company invest in other companies? If so, please comment.

Regarding capital vs. operating leases and liabilities that do not appear on the balance sheet but only show up in the notes to financial statements. How much and when is the money due?

Does McDonalds report any contingent liabilities in the notes to the financial statements? A contingent liability is something that may or may not occur such as a loss on a lawsuit. Search the terms "contingent liabilities" and "capital lease" in the SEC 10K Report.

What inventory system does McDonalds use? You will likely find this information in the notes to the financial statements. Start with the first Financial Statement Note. You can also search for the word inventory.

Regarding accounts receivable for McDonalds.

• Who owes the company money?

• What is the nature of the receivable (coupon payments, vendor rebates, or customer purchases are examples of the nature of the receivable)?

• Does the SEC 10-K disclose information on doubtful accounts?

• The balance sheet presentation shows the accounts receivable ‘net of allowance' and the notes to the financial statement will provide details on these values.

3. What do we learn from reviewing the Income Statement for the SEC 10-K company?

4. What do we learn from reviewing the Balance Sheet for the SEC 10-K company?

• What types of investments does your company report? 

• Did your company report any gains or losses from the sale of investments?

• Did your company report any gains or losses from the redemption of bonds?

2. Calculate the following ratios for your chosen company:
• Current Ratio
• Working capital
• Profit margin
• liquidity ratio
• solvency ratio
• And pick 2 more from the textbook
Provide some analysis on the ratios - what do they mean?

Notes to the financial statements can be used as well as browsing the company's website and searching the Internet. 

Reference no: EM13327084

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