OMM 622
Financial Statement Analysis
The University of Arizona Global Campus
OMM 622 Financial Decision-Making
Financial Statement Analysis
It is critical to study and determine a company's financial statements to make more
informed economic judgments when performing a financial statement analysis. Financial
statement analysis examines ratios and patterns derived from financial statement data.
Furthermore, this procedure enables a corporation to compare its performance to industry
averages or competitors. These comparisons aid in identifying financial assets and liabilities.
According to Epstein (2014), "Financial statements provide a snapshot of the financial health of
a company for a specific period, and give both internal and external readers information needed
to make financial decisions about a company" (sect.1.1, para.1). This paper will look at the
history of Apple Inc., the industry it serves, and how the economy may affect the company in the
future. It will also look at Apple Inc.'s short-term liquidity, operational efficiency, capital
structure, profitability, and future trend analysis recommendations.
Apple Inc Background, Economy, and Outlook for the Future
Apple Inc. is a technology company that is doing well. Steve Jobs and Steve Wozniak
founded the company in a garage in 1977, and it went public in 1980. Early product development
centered on laptop computers and personal computers like the Macintosh. Apple's focus would
shift to the consumer market during the next decade, with the release of iPhones, iPods, iTunes,
iPads, and other products. Jobs declared in January 2007 that the company would be called
"Apple Inc." The company's focus shifted from computers to consumer electronics. After
decades of tremendous expansion, Apple's market value was $1.3 trillion in December 2019
(Redpath & Vogel, 2020).
, Apple creates, manufactures, and distributes a variety of mobile devices, computers,
tablets, wearables, and accessories, as well as a variety of connected services. The firm's
equipment and digital content are highly regarded. Thousands of people are employed by the
firm. The company's programming developed many applications to assist employees in working
more efficiently, productively, creatively solving problems, and collaborating with a common
goal, and they are all meant to work well together.
People can produce their best work and impact a company's future when they have the
freedom to work the way they want, with the pressure and tools they like. Apple's future
prospects are defined by its capacity to produce and supply new innovative goods and services in
each of the markets in which it competes. Its ability to buy components in adequate numbers and
rely on its supply chain and manufacturing partners and personnel will determine future
operating performance.
According to Diehl (2016), "Investors and consumers love the company. Investors have
earned extraordinary returns on Apple stock as the company sets the record for the largest market
capitalization in history. Consumers seem to care less about the company ethics so long as they
receive the latest product" (p.167).
Apple Inc Short Term Liquidity
"Liquidity ratios measure the quality of current assets and whether these assets are
sufficient to meet current obligations as they become due” (Epstein, 2014, sect.6.3, para.4).
Liquidity ratios give information about a business’s ability to meet its short-term financial
obligations.
Current Ratio is calculated using the following equation: Total Current Assets / Total Current
Liabilities. For industrial enterprises, a ratio of 2.5 is often regarded as optimal.
09/26/2020 09/28/219 09/29/2018
143,713,000,000 / 162,819,000,000 / 131,339,000,000 /
105,392,000,000 = 1.36> 105,718,000,000 = 1.54> 116,866,000,000 = 1.12>
Financial Statement Analysis
The University of Arizona Global Campus
OMM 622 Financial Decision-Making
Financial Statement Analysis
It is critical to study and determine a company's financial statements to make more
informed economic judgments when performing a financial statement analysis. Financial
statement analysis examines ratios and patterns derived from financial statement data.
Furthermore, this procedure enables a corporation to compare its performance to industry
averages or competitors. These comparisons aid in identifying financial assets and liabilities.
According to Epstein (2014), "Financial statements provide a snapshot of the financial health of
a company for a specific period, and give both internal and external readers information needed
to make financial decisions about a company" (sect.1.1, para.1). This paper will look at the
history of Apple Inc., the industry it serves, and how the economy may affect the company in the
future. It will also look at Apple Inc.'s short-term liquidity, operational efficiency, capital
structure, profitability, and future trend analysis recommendations.
Apple Inc Background, Economy, and Outlook for the Future
Apple Inc. is a technology company that is doing well. Steve Jobs and Steve Wozniak
founded the company in a garage in 1977, and it went public in 1980. Early product development
centered on laptop computers and personal computers like the Macintosh. Apple's focus would
shift to the consumer market during the next decade, with the release of iPhones, iPods, iTunes,
iPads, and other products. Jobs declared in January 2007 that the company would be called
"Apple Inc." The company's focus shifted from computers to consumer electronics. After
decades of tremendous expansion, Apple's market value was $1.3 trillion in December 2019
(Redpath & Vogel, 2020).
, Apple creates, manufactures, and distributes a variety of mobile devices, computers,
tablets, wearables, and accessories, as well as a variety of connected services. The firm's
equipment and digital content are highly regarded. Thousands of people are employed by the
firm. The company's programming developed many applications to assist employees in working
more efficiently, productively, creatively solving problems, and collaborating with a common
goal, and they are all meant to work well together.
People can produce their best work and impact a company's future when they have the
freedom to work the way they want, with the pressure and tools they like. Apple's future
prospects are defined by its capacity to produce and supply new innovative goods and services in
each of the markets in which it competes. Its ability to buy components in adequate numbers and
rely on its supply chain and manufacturing partners and personnel will determine future
operating performance.
According to Diehl (2016), "Investors and consumers love the company. Investors have
earned extraordinary returns on Apple stock as the company sets the record for the largest market
capitalization in history. Consumers seem to care less about the company ethics so long as they
receive the latest product" (p.167).
Apple Inc Short Term Liquidity
"Liquidity ratios measure the quality of current assets and whether these assets are
sufficient to meet current obligations as they become due” (Epstein, 2014, sect.6.3, para.4).
Liquidity ratios give information about a business’s ability to meet its short-term financial
obligations.
Current Ratio is calculated using the following equation: Total Current Assets / Total Current
Liabilities. For industrial enterprises, a ratio of 2.5 is often regarded as optimal.
09/26/2020 09/28/219 09/29/2018
143,713,000,000 / 162,819,000,000 / 131,339,000,000 /
105,392,000,000 = 1.36> 105,718,000,000 = 1.54> 116,866,000,000 = 1.12>
