Financial Statement Analysis Project
Sprouts Farmer Markets vs Whole Foods

Financial Accounting and Reporting
ACTG 4610

August 10, 2015

Table of Contents

1. Background of Sprouts Farmers Market 3
1.1 Description of the company and its business 3
1.2 Business Environment 3
2. Income Statement 4
2.1 Major Sources of Operating Revenues and Revenue Recognition Method 4
2.2 Major Types of Operating Expenses 5
2.3 Significant changes in operating revenues and expenses 5
2.4 Other items on the income statement 6
3. Balance Sheet 7
3.1 Current and long-term assets 7
3.2 Current and long-term liabilities 9
3.3 Major Components of Stockholders’ Equity 10
3.4 Significant Changes in the Balance Sheet 10
4. Statement of Cash Flows 11
4.1 Major Adjustments to Net Income 11
4.2 Major inflows and outflows of cash for investing activities 11
4.3 Major inflows and outflows of cash for financing activities 12
4.4 Significant Changes in Cash Flow 12
5. Ratio Analysis 13
5.1 Computed Ratios 13
5.2 Discussion of Ratios 14
6. Summary 15

1. Background of Sprouts Farmers Market 2.1 Description of the company and its business (p.1,7-9 10-K)
Sprouts has become a chain of grocery store that identify themselves as being healthy. They offer natural, organic and most importantly fresh food and other products to their customers. Sprouts sells these products at compelling prices, prices they believe are significantly lower below those of other food retailers. Because of that, they become attractive to a much wider spectrum of customers and are not as limited as other natural, organic specialty retailers. Selling healthy, natural and organic products in grocery stores is the only line of business they are