Examining Financial Statements - Landry's Restaurants

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Examining Financial Statements - Landry's Restaurants
Financial statement users around the globe use financial statements to evaluate the performance of companies (Fundamentals of Financial Accounting, 2006). In order to locate a company’s reported assets, liabilities, expenses and revenues, statement users rely on four types of financial statements. The four financial statements include: Balance Sheet, Income Statement, Statement of Retained Earnings, and Statement of Cash Flows (Fundamentals of Financial Accounting, 2006, p. 6). Each of these reports provides different information to the financial statement user. The Balance Sheet reports at a point in time: a company’s assets (what it owns), liabilities (what it owes) and stockholder’s equity (what is left over for the owners) (Fundamentals of Financial Accounting, 2006, p.7). The Income Statement shows whether a business made a profit (net income) during a specific period of time (Fundamentals of Financial Accounting, 2006, p. 10). The Statement of Retained Earnings illustrates what portions of the company’s earnings was paid to stockholders and retained by the company for future operations (Fundamentals of Financial Accounting, 2006, p.12). Finally, the Statement of Cash Flows reports summarizes how a business’ “operating, investing, and financial activities caused its cash balance to change over a particular range of time” (Fundamentals of Financial Accounting, 2006, p.13). This paper examines the Annual Report of Landry’s Restaurants, Inc. Specifically, this paper demonstrates how certain financial elements can be located in Landry’s financial statements. The key financial components discussed include: (1) net income, (2) total assets, (3) property and equipment additions, and (4) stock options.

Income
To locate the net income for Landry’s Restaurants, a financial user would look at the Income Statement. As mentioned above, the Income Statement will report Landry’s net income (or profit) during...
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