Question: The Evolution of Gap, Inc. Many of today's most notable companies had very humble beginnings. Gap, Inc., began in 1969 when Don and Doris Fisher opened a clothing store in San Francisco. The company grew quickly, becoming a publicly traded company in just seven years. The company expanded beyond its Gap store concept in 1983 by purchasing Banana Republic, a small safari and travel clothing company. Gap further extended its penetration into the clothing market by introducing the Old Navy brand in 1994. The rest, as they say, is history. With over 3,000 stores, Gap, Inc., is now a major force in the apparel industry. Each of its clothing brands targets different customers. The original Gap brand targets style-conscious customers in the casual specialty market. Banana Republic targets men and women who want more sophisticated seasonal fashions, shoes, personal care products, intimate apparel, and gifts for the home. Old Navy is more value focused, providing families with great fashions at affordable prices.
Critical Thinking
1. Should a single set of financial statements be prepared for Gap Inc., or should financial statements be prepared for each brand?
2. How would the chart of accounts differ among the three brands?