...Financial Statements Paper Part 1 ACC 497 July 14, 2014 Financial Statements Paper Part 1 In Financial Statements Paper Part 1 I will discuss The Home Depot’s annual report, to include the consolidated statement of earnings, the balance sheet, and the statement of cash flows. I will discuss some details of each sheet, the importance of the contents, business decisions associated with each sheet, and the benefits gained from the information contained in the sheets. The Consolidated Statement of Earnings-- income statement-- tells the reader about the sales and expenses applied by The Home Deport during the most recent fiscal year. An immediate analysis of this income statement indicates the company has net sales figures between $70 billion and $80 billion per year. This is a significant difference over a three year time period. The one very noticeable issue is the substantial decrease in sales from 2008 to 2009. The Home Depot´s net sales in 2008 dropped roughly eight percent compared to the previous year. Operating expenses increased by approximately 105%, while operating income decreased by about 40%. The increase in operating income helped bring the numbers up, but after it is all said and done, the bottom line is the fact that net earnings were down approximately 49% in 2008 compared to the previous year. The Home Depot attributed the significant decline in sales to the decline in the residential (new) construction and home improvement markets. In addition...
Words: 1052 - Pages: 5
...Financial Statements Part 1 Accounting 497 Financial Statements Part 1 Financial statements provide investors, creditors, and employees with important information related to a company’s overall performance. Public traded companies are required by the Securities and Exchange Commission to release financial statements on quarterly and annual basis. The three main statements included in the annual report include the consolidated statement of earnings, balance sheet, and statement of cash flows. This paper will analyze Home Depot, Inc. 2008 annual report. The Home Depot, Inc. The Home Depot is a public “do-it yourself” home improvement and construction retailer. The Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank (depot, 2015). The company’s website states that “today The Home Depot is the world’s largest home improvement specialty retailer, with more than 2,200 retail store in the United States (including Puerto Rico and the U.S. Virgin Islands), Canada, and Mexico” (depot, 2015). The Consolidated Statements of Earnings The consolidated statement of earnings or commonly known as the income statement is a financial statement that measures a company’s financial position over a specific accounting period. The statement includes: revenues, expenses, gains and losses. The fundamental equation used to generate the income statement is Revenues-Expenses=Profit or Loss. A consolidated statement of earnings combines all major expense accounts into broad categories...
Words: 921 - Pages: 4
...Financial Statements Paper - Part I Bridgette Toutant ACC/497 March 31, 2014 Ken Goranson Financial Statements Paper - Part I A financial statement offers users, such as management, board of directors, and potential investors, information related to the company’s activities and it gives them the ability to make decisions in relation to the company. A certain amount of urgency should exist when providing this useful information because the financial statements are considered to be a powerful and commonly used tool. The most commonly used of all the financial statements would be the income statement because it can be used to examine the profits and losses of a company. Many users do also find that the balance sheets and cash flow statements just as useful in the decision making process. The following will include the analysis of Home Depot’s annual report by examining the income statement, balance sheet, and cash flow statement and looking at how they can help with business decisions. The Consolidated Statements of Earnings, the income statement, tells the user about the sales and expenses of Home Deport during each fiscal year. Analyzing the income statement for Home Depot, it appears that the company had strong sales numbers of over $71 billion each year. Even though the company was able to keep sales over $71 billion, it is noticeable that the sales and gross profits declined from 2007 to 2009 (The Home Depot, 2009). It also seems that an increase in expenses...
Words: 1358 - Pages: 6
...Financial Statements Papers Part I Sherrie Christian ACC/497 April 8, 2013 Rick Kwan, MBA Financial Statements Papers Part I The financial statements are important as they inform the users of the economic health and stability of the entity. Each financial statement provides information to determine economic health, such as financial position, performance, and changes. Assets, liabilities, and equity provide a measurement of financial position. Income and expenses provide a measurement of performance. The income statement is a vital section of the financial statements, also known as the profit and loss statement. The income statement presents revenue balances, and profits for a specific period of reporting. The income statement presents sales, cost of sales, operating and non-operating expenses, and the income for the prior three reporting periods. The income statement presents awareness of changes or the lack of changes in the sales balances, cost of sales, and operating and non-operating expenses. The income statement provides comparisons of prior reporting periods to current reporting periods. The income statement measures the business performance in terms of revenue, and net income. Managers practice income statement analysis to work out inefficiencies, and processes that are ineffective. Revenue, expenses, and net income are the major parts of the income statement. A financial statement user can view the Home Depot Statement of Earnings for the fiscal year ending...
Words: 1069 - Pages: 5
...Financial Statements Paper Part I ACC 497 Dally Sichmeller August 9, 2014 Robert Davis Financial Statements Paper Part Companies issue annual reports every year, these annual reports contain financial statements that include the income statement, balance sheet and statement of cash flow. In order to understand the annual report, one has to know what information these statements give and why they are important. The information in these statements can also be useful in making business decisions. In this paper we will discuss the contents, the importance and the usefulness of these statements found in Home Depot 2008 Annual Report. Consolidated Statements of Earnings - Income Statement The consolidated statement of earnings or the income statement reports the companies income, expenses, and profits over a period of time, usually a year. The Home Depot uses a multiple-step income statement, this type of statement separates revenue operating revenue and expenses from all other types of revenue and expenses. The income statement includes net sales, costs of goods sold, and gross profits according to the Home Depots income statement sales and profit has decreased over the last three years. Part of this could be due to the increase in operating and non-operating expenses. Cash disbursements and cash receipts are not included in the income statement. Income statements also show the earnings per share (EPS) or how much money a shareholder would receive if the Home Depot were...
Words: 1117 - Pages: 5
...Financial Statements Paper Part I ACC/497 March 7, 2016 Financial Statements Paper Part I Financial statements allow users to view company performance, analyze past trends, project future performance, and make essential business decisions regarding investing into the enterprise. The consolidated statement of earnings, balance sheet, and statement of cash flows are a few of the reports users may look to find crucial information regarding the business. Reviewing The Home Depot's financial statements offers a glimpse into how the company performed during the 2008 and 2009 fiscal years and what business decisions should be made based upon the company's reports. Consolidated Statements of Earnings The consolidated statement of earnings, the income statement, displays relevant business information to users to predict future cash flow by evaluating past trends of a company, forecasting future performance, and assess risks of achieving future cash flows (Kieso, Weygandt & Warfield, 2013). The income statement contains elements such as revenues, expenses, gains, and losses. In Home Depot’s income statement information depicts a steady decline in gross profits, operating income, net earnings, and earnings per share, while they reported an increase in operating expenses. Gross profits declined from 2007 to 2009 from $26.5 billion to $23.9 billion. Operating income decreased by half from $8.8 billion to $4.3 billion in 2009. Net earnings dropped from $5.8 billion to $2...
Words: 1567 - Pages: 7
...Financial Statements Paper Part I Student ACC 497 8.17.2015 Professor Financial Statement Paper Part I: Home Depot For employees, creditors, and investors, financial statements are essential. They provide insight and information regarding a company’s overall performance. The Securities and Exchange Commission (SEC) requires that all publicly traded companies release their financial statements on a regular basis – quarterly and annually. The annual report consists of three main reports: the consolidated statement of earnings (the income statement), the balance sheet, and the statement of cash flows. The following is a discussion of Home Depot’s 2008 Annual Report. Home Depot is a large, retail chain that specializes in home improvement. The income statement, its importance, what decisions it aids The income statement helps to understand a company’s financial performance. In plain terms, the income statement shows how a company made a profit or suffered a loss during a set period of time. The income statement is generated with a very simple formula of subtracting all Expenses from Revenues, thus arriving at the Profit or Loss. The income statement simplifies everything by merging all of the major expense accounts under one, more generic label. This simplicity aids any users of the income statement to have easy comprehension, and have a higher level of overview of the operation’s performance. Investors are able to forecast probable stock prices rising and...
Words: 1224 - Pages: 5
...Financial Statements Paper Part I Using Home Depot, Inc. 2008 Annual Report located in Appendix A of the text, Fundamentals of Financial Accounting, prepare a 1,050-1,750-word paper in which you answer the following questions: What does the income statement tell you about the company? Why is this statement important? What business decisions could be made using the income statement? What does the balance sheet tell you about the company? Why is the balance sheet important? What business decisions could be made using the balance sheet? What does the statement of cash flows tell you about the company? What business decisions could be made using the statement of cash flows? What information is provided in the statements that will assist you in making these business decisions? What information is not provided that could assist in managerial decision making? Financial Statements Paper Part II Using Home Depot, Inc. 2008 Annual Report located in Appendix A of the text, Fundamentals of Financial Accounting, prepare a 1,050-1,750-word paper in which you address the following items: Does management’s assessment of the financial condition agree with your assessment from the Financial Statements Paper Part I? Explain. Support your answer using trend analysis, vertical analysis, and ratio analysis. In the Annual Report, there are several concerns from management. Discuss these concerns, and identify other weaknesses not discussed by management. Then, recommend a course of action...
Words: 1423 - Pages: 6
...but on an adjusted basis declined 6.7 percent. At the end of 2008, the U.S. economy was in the most severe recession it has experienced since the great depression. We planned for this tough economic environment, and we executed well against our plan, exceeding the sales and earnings targets we set forth at the beginning of the year. We gained over 100 basis points of U.S. market share in 2009, a notable accomplishment on a base of fewer stores. We saw sequential improvement in our performance during the year and exited the year with a positive comp in the fourth quarter. We also saw signs of stabilization in some key macroeconomic indicators, such as Private Fixed Residential Investment as a percent of GDP. In Canada, the demand for home improvement products is showing improvement. And our Mexican team delivered positive comps for the year in a very tough economic environment. As we look to 2010, we believe we will see modest economic recovery in the markets we serve and expect our performance to continue to improve as the economy undergoes a steady, though slow, recovery. As a company, we made significant progress against our strategic imperatives in 2009. We enhanced customer service in our stores, introduced new and innovative products with compelling values, and drove productivity and efficiency. Our customer service levels, as measured by our Voice of the Customer surveys and other external sources, continue to improve. A key factor in this improvement was the...
Words: 32934 - Pages: 132
...CONFORMING LETTER Home Depot Inc. Dear Home Depot Inc. Management, As a partner of KNAM LLC, it is my pleasure to present you with the results of our initial review. Included with these results is our assessment of Home Depot Inc.’s performance is our proposition of areas we’d like to review further to determine improvements, efficiency, functionality, and health of your organization. Background Your organization’s core service is in the DIY home improvement market. You sell goods that consumers need for home improvement as well as advice on said projects, contracting services, lawn and garden, and appliances and tools. Your organization was founded in 1978 with the purpose of providing DIY one-stop shopping. Since inception, Home Depot Inc. has grown to become a multinational company with foundations strongly in the United States with roots in the Canadian, Mexican, and Chinese markets. Shortly after inception, Home Depot Inc. enlisted on NASDAQ and the NYSE. Your company has seen considerable growth in its main business as well as developments in subsidiary businesses and services. Home Depot Inc. has become one of the fastest growing retailers in America and as such, you would like to review the operations of your organization to determine areas of further growth and areas that may need to be leaner. Objectives of the Operational Review As a result of our initial review and interviews with your executive management...
Words: 8379 - Pages: 34
...The Home Depot 2008 Annual Report Dear Shareholders: In 2008, our retail sales declined by 7.8 percent, with comp sales down 8.7 percent. Our adjusted earnings per share from continuing operations declined 22 percent. In ordinary times, these would be very disappointing results. But 2008 was not an ordinary year. Despite the difficult economic environment, we continued to improve our retail business, through investing in our associates and our stores, rebuilding our supply chain and improving customer service. We also made several strategic decisions to optimize our capital allocation, concentrating our efforts on our core business. In the first quarter, we closed 15 underperforming stores and reduced our pipeline of new stores by 50. In the third quarter, we renegotiated our private label credit card agreement, capping our cost of private label credit. In the fourth quarter, we announced our decision to exit EXPO and related businesses. These actions will make the Company stronger. On the financial side, we ended the year with a solid operating profit and $41 billion in assets. We generated cash from the business of approximately $5.5 billion, which allowed us to invest in the business where necessary and reduce our debt obligations while maintaining a healthy dividend. On the operational side, we implemented an “Aprons on the Floor” initiative, which deployed over $200 million in annualized savings onto the floor of the stores for customer service...
Words: 30302 - Pages: 122
...50 Hurt Plaza, S.E., Suite 595, Atlanta, GA 30303‐2915 • 404‐523‐6220 Georgia Humanities Grant Guidelines, Fall 2015 Application deadline: September 30, 2015 Maximum Grant Amount: $2,000 Projects can begin on or after January 30, 2016 Georgia Humanities invites 501(c)‐3 nonprofit organizations to apply for a program grant of up to $2,000 to support local humanities programs. The National Endowment for the Humanities defines the humanities as: The study of history, literature, language (modern and classical), philosophy and archaeology; as relevant to the human environment and with particular attention to reflecting our diverse heritage, traditions, and history and to the significance of the humanities to the current conditions of national life. Eligibility All applicants (nonprofit organizations) must have an IRS 501(c)‐3 status and must include their IRS determination letter with the application. GH also requires a DUNS number. Individuals are ineligible to apply. Organizations with an open GH grant are not eligible to apply until all required final paperwork is submitted. Examples of GH‐funded projects include: film presentations with discussions; literary events; historic walking tours/ printed guide booklets; cemetery programs/tours; living history programs with scholar introductions; exhibitions; oral history projects; educational workshops (children and adults) in college and public libraries; digital adaptations of existing records with ...
Words: 2580 - Pages: 11
...Ethics and Compliance Paper Shalom J. Duarte, Chris Campbell, Eric Newhart, & Ron Reda FIN/370 June 18, 2013 James Campbell Ethics and Compliance Paper Strategic planning and financial preparation are vital to ensure the success of big retail corporation such as Lowes. This type of planning happens when a company sets up both long term and short term goals for their strategic marketing and planning to achieve financial success. Strategic initiatives can be created in various areas, such as in the area of new products being rolled out and new departments being created. In particular a strategic plan, determines a company’s long term goals and then identifying the best approach for achieving those goals. From the financial perspective, financial planning initiatives are long-term plans aimed at generating capital with objectives focused on greater return on assets, growth in market share, and at solving foreseeable problems. When Strategic plans are met, such as plans focused on certain products or departments, it helps the overall health of the company’s financial status in different areas such as with the store’s revenue, over head spending control, and maintaining a store’s budget. Both Strategic and financial planning share the same company goals for success and the understanding of where the financing must come from to accomplish these goals. Lowes is a leader in home improvement and is committed to never stopping improvement. Lowes mission is to deliver...
Words: 1534 - Pages: 7
...course requirement. This report has been valuable to me as it assisted to unite the practical experience to theoretical knowledge. I would like to mention that I am extremely grateful to you for your valuable guidance, extreme understanding effort and constant attention as and when required in accomplishing the report. I shall be very pleased to answer any query you think necessary as and when needed. Sincerely Yours, Mia Mohammad Irfan ID: 09204036 BRAC Business School Acknowledgement I acknowledge my heartiest gratefulness to all who have extended their hands of cooperation in preparing the report. At first I express my gratitude and acclaim our indebtfulness towards my relevant course instructor Showvonick Datta for his overall guidance, advice and support in encouraging our reponsibilities consciously while creating this report. I would like to express gratitude towards Mr. Faijullah Zisan, Assistant Manager Export, PRAN Export Limited for his assisting approach and effort to provide me the necessary information and kind assistance while preparing this report. I would also like to thank all the employees of PRAN Export Limited members for their sincere effort in completing this report. Without the teamwork and assisting attitude of the members of PRAN Export Limited it would not have been possible in finishing this regulatory report. I would be thankful if this report comes to any benefit of my teacher...
Words: 8958 - Pages: 36
...s Global Communications Joy Daniels, MMBPL500 Foundations in Problem Based Learning September 20, 2010 Louise Stelma Global Communications Global communication is the process of exchanging and receiving information on a world-wide scale. Until recent times it was difficult to communicate with other countries, with factors such as time, distance, and language barriers being major restrictions. However, the evolution of technology communication has become increasingly easier, faster, clearer and more effective (Lubbers & Koorevaar, 2000). . Course Concepts Identified Though Global Communications and the situations involved present multiple problems one sees the potential for possible solutions. The course concepts in the following synopses include communication issues, ethical dilemmas such as integrity, social responsibility and the quality of life. All of the above listed items will show a need for improvement in the globally communicative world that one lives in. As new creations, such as the internet are continually being created, modified and converged with other products, they are enabling new modes of interaction. Even more global communications has hit the world in a strategic and effective manner. Global markets now offer the ability to produce cheaper products, access to consumers in foreign countries, new sources of finance and income, new sources of technology and access to a world of people with know-how. (Stevens, Miller & Michalski...
Words: 5525 - Pages: 23
