At this time, the Company is unable to make a reasonably reliable estimate of the timing of payments due to uncertainties in the timing of tax audit outcomes; therefore, such amounts are not included in the above contractual obligation table. The Company’s other purchase obligations consisted of noncancelable obligations to acquire capital assets, including product tooling and manufacturing Online Accounting process equipment, and noncancelable obligations related to advertising, licensing, R&D, internet and telecommunications services and other obligations. As of September 30, 2017, the Company had other purchase obligations of $6.1 billion. The Company uses the net proceeds from the commercial paper program for general corporate purposes, including dividends and share repurchases.
115) On a work sheet, the adjusted balances of revenues and expenses are sorted to the Income Statement columns of the work sheet. 100) Plant assets are usually listed in order by how quickly they can be converted to cash. All fiscal year figures are decreased by the value 1 or 2 or increased by the value 1 according to the requirement. The fiscal year conversion is performed either for all company codes of a client or for individual company codes of the same fiscal year variant. Attributing preferred shares to one or the other is partially a subjective decision. Liquidity also refers both to a business’s ability to meet its payment obligations, in terms of possessing sufficient liquid assets, and to such assets themselves. For assets themselves, liquidity is an asset’s ability to be sold without causing a significant movement in the price and with minimum loss of value.
Queenan Company computes depreciation on delivery equipment at $1,000 for the month of June. Revenue is recorded only when cash is received, and expense is recorded only when cash is paid. In another example, the State of Texas has designated a fiscal year that extends from September 1, 2000, through August 31, 2001.
What Fiscal Quarter Are We In?
An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In the second quarter of 2014, shareholders approved the 2014 Employee Stock Plan (the “2014 Plan”) and terminated the Company’s authority to grant new awards under the 2003 Employee Stock Plan (the “2003 Plan”). The 2014 Plan provides for broad-based equity grants to employees, including executive officers, and permits the granting of RSUs, stock grants, performance-based awards, stock options and stock appreciation rights, as well as cash bonus awards. RSUs granted under the 2014 Plan generally vest over four years, based on continued employment, and are settled upon vesting in shares of the Company’s common stock on a one-for-one basis.
Successful branding is why fashions by Georgio Armani bring to mind style, exclusiveness, desirability. Branding is why riding Harley Davidson motorcycles makes a statement about the owner’s lifestyle.
It is important in accrual accounting because cash cycles may not be complete. Therefore, it is necessary to understand which events will be during the current reporting period and which events will be recorded in the next reporting period. Debtors ‘ management involves identifying the appropriate credit policies, i.e. credit terms which will attract customers, such that any impact on cash flows and the cash conversion cycle will be offset by increased revenue and hence, return on capital. Working capital is a financial metric which represents operating liquidity online bookkeeping available to a business, organization or other entity, including a governmental entity. Along with fixed assets, such as plant and equipment, working capital is considered a part of operating capital. The goal of working capital management is to ensure that the firm is able to continue its operations and that it has sufficient cash flow. For a corporation with a published balance sheet there are various ratios used to calculate a measure of liquidity, namely the current ratio, the quick ratio, the operating cash flow ratio, and the liquidity ratio .
The Balance Sheet
This date makes sense since the company’s financial-reporting year ends after the holidays, which is when retailers generate most of their earnings for the year. Investors might ask, “What fiscal year is it?” and it can vary from company-to-company. A 10-K is an annual filing of financial performance, according to their fiscal year, which is filed with the Securities and Exchange Commission or SEC.
Fixed assets are shown in the balance sheet at historical cost less depreciation up to date. Depreciation affects the carrying value of an asset on the balance sheet. The historical cost will equal the carrying value only if there has been no change recorded in the value of the asset since acquisition. Historical cost is criticized for its inaccuracy since it may not reflect current market valuation. Some of the current assets are valued on an estimated basis, so the balance sheet is not in a position to reflect the true financial position of the business. Investments accounted for by using the equity method are 20-50% stake investments in other companies.
The Company records deferred revenue upon the sale of the card, which is relieved upon redemption of the card by the customer. Revenue from AppleCare service and support contracts is deferred and recognized over the service coverage periods. AppleCare service and support contracts typically include extended phone support, repair services, web-based support resources and diagnostic tools offered under the Company’s standard limited warranty. The Company’s products and services include iPhone, iPad, Mac, Apple Watch, Apple TV, a portfolio of consumer and professional software applications, iOS, macOS, watchOS and tvOS operating systems, iCloud, Apple Pay and a variety of accessory, service and support offerings. The Company sells and delivers digital content and applications through the iTunes Store, App Store, Mac App Store, TV App Store, iBooks Store and Apple Music (collectively “Digital Content and Services”). As of September 30, 2017 and September 24, 2016, the Company had outstanding floating- and fixed-rate notes with varying maturities for an aggregate carrying amount of $103.7 billion and $78.9 billion, respectively.
How To Prepare A Balance Sheet
Shrinkage is estimated as a percentage of sales at interim periods and for this approximate three-week period, based on historical shrinkage rates. Permanent markdowns designated for clearance activity are recorded when the utility of the inventory has diminished. Factors considered in the determination of permanent markdowns include current and anticipated demand, customer preferences, age of the merchandise and fashion trends. When a decision is made to permanently markdown merchandise, the resulting gross margin reduction is recognized in the period the markdown is recorded. The Company maintains customer loyalty programs in which our customers earn points based on their spending. Under the Macy’s brand, the Company participates in a coalition program whereby customers can earn points based on spending levels with bonus opportunities through various targeted offers and promotions at Macy’s and other partners.
Cost factors represent the average cost-to-retail ratio for each merchandise department based on beginning inventory and the annual purchase activity. At January 30, 2016 and January 31, 2015, merchandise inventories valued at LIFO, including adjustments as necessary to record inventory at the lower of cost or market, approximated the cost of such inventories using the first-in, first-out retail inventory method. The application of the LIFO retail inventory method did not result in the recognition of any LIFO charges or credits affecting cost of sales for 2015, 2014 or 2013. The retail inventory method inherently requires management judgments and estimates, such as the amount and timing of permanent markdowns to clear unproductive or slow-moving inventory, which may impact the ending inventory valuation as well as gross margins. The Company from time to time invests in debt and equity securities, including companies engaged in complementary businesses.
- As of September 30, 2017, approximately 327.9 million shares were reserved for future issuance under the 2014 Plan.
- On a balance sheet, the value of inventory is the cost required to replace it if the inventory were destroyed, lost, or damaged.
- The Company regularly assesses the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of its provision for taxes.
- Although a fiscal year can start on January 1st and end on December 31st, not all fiscal years correspond with the calendar year.
- The term “fiscal year-end” refers to the completion of any one-year or 12-month accounting period other than a typical calendar year.
Between the period of the cut-off date and the authorization of financial statements issuance is the subsequent events period. Depending on the type of subsequent event, it may or may not require an adjustment to the financial retained earnings statements. Transactions and events that change the measurement of transactions before the cut-off date are recognized. The cut-off date refers to the end of the reporting period and the start of the new reporting period.
The year-over-year growth in Services net sales in 2017 was due primarily to increases in App Store and licensing sales. Includes sales of Apple TV, Apple Watch, Beats products, iPod touch and Apple-branded and third-party accessories. Includes deferrals and amortization of related software upgrade rights and non-software services. A 14th week was included in the first quarter of 2017, as is done every five or six years, to realign the Company’s fiscal quarters with calendar quarters. The Company could be subject to changes in its tax rates, the adoption of new U.S. or international tax legislation or exposure to additional tax liabilities. The Company expects its quarterly revenue and operating results to fluctuate. Much of the Company’s future success depends on the continued availability and service of key personnel, including its Chief Executive Officer, executive team and other highly skilled employees.
What Are Fiscal Quarters? Definition, Purpose And How They Work
The balance sheet is often described as a snapshot of a company’s financial condition. The end of your natural business year is usually the time when you’re most likely to have converted your inventory to cash, and your current ratio is at its maximum (i.e. when you’re at your most liquid and capable of paying your debts). They want to do their accounting and generate their first set of financial statements (e.g. because they’re in the process of applying for a loan). Your business fiscal year is almost always your tax year, but it doesn’t have to be.
During 2017, the Company spent $33.0 billion to repurchase shares of its common stock and paid dividends and dividend equivalents of $12.8 billion. Additionally, the Company issued $24.0 billion of U.S. dollar-denominated term debt, €2.5 billion of euro-denominated term debt and C$2.5 billion of Canadian dollar-denominated term debt during 2017. The Company’s operations and performance depend significantly on global and regional economic conditions. These worldwide and regional economic conditions could have a material adverse effect on demand for the Company’s products and services. Demand also could differ materially from the Company’s expectations as a result of currency fluctuations because the Company generally raises prices on goods and services sold outside the U.S. to correspond with the effect of a strengthening of the U.S. dollar. These and other economic factors could materially adversely affect demand for the Company’s products and services.
Accounting For Subsequent Events
At the time gift cards are sold, no revenue is recognized; rather, the Company records an accrued liability to customers. The liability is relieved and revenue is recognized equal to the amount redeemed at the time gift cards are redeemed for merchandise. The Company records income from unredeemed gift cards as a reduction of SG&A expenses, and income is recorded in proportion and over the time period gift cards are actually redeemed. At least three years of historical data, updated a company’s fiscal year must correspond with the calendar year. annually, is used to determine actual redemption patterns. Merchandise inventories are valued at lower of cost or market using the last-in, first-out retail inventory method. Under the retail inventory method, inventory is segregated into departments of merchandise having similar characteristics, and is stated at its current retail selling value. Inventory retail values are converted to a cost basis by applying specific average cost factors for each merchandise department.
Backlog is often reduced once customers believe they can obtain sufficient supply. Because of the foregoing, backlog should not be considered a reliable indicator of the Company’s ability to achieve any particular level of revenue or financial performance. The Company is committed to delivering solutions to help educators teach and students learn. The Company believes effective integration of technology into classroom instruction can result in higher levels of student achievement and has designed a range of products, services and programs to address the needs of education customers. The Company also supports mobile learning and real-time distribution of, and access to, education-related materials through iTunes U®, a platform that allows students and teachers to share and distribute educational media online. The Company sells its products to the education market through its direct sales force, select third-party resellers and its retail and online stores. These include assistance that is built into software products, electronic product manuals, online support including comprehensive product information as well as technical assistance, the AppleCare® Protection Plan (“APP”) and AppleCare+ (“AC+”).