Research one (1) publicly traded company in which you are interested. Review its most recent statement of cash flows and income statement on the company Website. Discuss.
What Is The Income Statement:
A company's Income Statement is one of the four core financial statements under GAAP. The Income Statement provides users with information regarding the revenue generated during the period, the business expenses incurred, and the resulting income.
Answer and Explanation:
I will use the example of Apple Inc. (US: AAPL), using their 2019 annual report. Below are my observations:
- The company posted a slight decrease in revenue but nonetheless generated $260 Billion in sales.
- There is a slight increase in operating expenses ($5 Billion), largely due to increased research expenses.
- Net income is $55 Billion, which is slightly lower than the previous year due to higher operating expenses and lower sales.
- Operating cash flow decreased by $8 Billion which is largely attributable to the drop in net income. However, it must be said that generating $69 Billion in operating cash flow is nonetheless very healthy.
- The company generated $45 Billion for investing activities, largely due to selling almost $100 Billion in investments.
- The company used $90 Billion for financing activities, which was largely due to the $66 Billion of stock repurchases.
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from Accounting 101: Financial AccountingChapter 2 / Lesson 2