You are part of the team of Long & Associates Financial Accountants/Consultants .
A client/investor is considering investing in Apple, the consumer products giant. They come to your firm to understand the company performance and eventually to make an investment decision on buying, selling, or holding Apple's stocks. .
You have been tasked with the job of analyzing Apple's financial position between 2013 and 2014 and reporting to the investor your findings.
Analyze Apple's balance sheets of 2014 and 2013. You can retrieve Apple's annual report from https://www.sec.gov/edgar/searchedgar/companysearch.html by searching Apple Inc. 10-k indicates annual reports; 10-q indicates quarterly reports. You will focus on annual reports for this assignment.
The following list of questions provides a good start. Please limit your report into 4 pages, double spaced. An acceptable report should address the following questions.
a. What is the fiscal year end of Apple? How many shares were issued and outstanding as of the fiscal year end of 2014? What is the monetary amounts for Apple's financial statements?
b. What is the firm's largest asset and liability account in 2014 and what is the carrying value of these accounts?
c. What do you think is the Apple's most valuable resources? Can you find it on Apple's balance sheet? Why (or Why not)?
d. Compare Apple's balance sheets of 2014 and 2013 and identify the account that experienced the largest change and provide the possible reasons that contribute to the change.
e. How does Apple's 2014 net income impact Apple's 2014 balance sheet?
f. Did Apply pay any dividend in 2014? How did it impact 2014's Balance sheet? Where do you find the dividend payment information?
g. What is the book value of Apple's shareholders' equity by the fiscal year end of 2014? What is the market value of Apple's equity on September 27th, 2014? What is Apple's market-to-book ratio of equity? Why Apple's market-to-book ratio is so different from 1 (hint: it goes back to question c)?