Mcdonalds Accounting Report

Topics: McDonald's, Generally Accepted Accounting Principles, Balance sheet Pages: 12 (2358 words) Published: February 7, 2011
Brief History3
McDonalds’ today4
McDonalds’ Pakistan5
Operations (equipment and franchising)6
Marketing (sales marketing)7
Development (property and construction)7
Finance (supply chain and new product development)7
Information Technology8
What McDonalds’ do with its Profits?8
Hierarchy of McDonalds’9
Hierarchy of Accounting Department11
How profit is measured in McDonalds’?11
Financial Statements12
Statement of cash flows16
Statement of owner's equity18
How inventory is handled w.r.t. Accounting20
Bad Debts20
Bank Reconciliation Statement20


Brief History
The business began in 1940, with a restaurant opened by brothers Richard and Maurice McDonald in San Bernardino, California. Their introduction of the "Speedee Service System" in 1948 established the principles of the modern fast-food restaurant. In 1954, Ray Kroc, a seller of Multimixer milkshake machines, learned that brothers Richard and Maurice (Dick and Mac) McDonald were using eight of his high-tech Multimixers in their San Bernardino, California, restaurant. His curiosity was piqued, and he went to San Bernardino to take a look at the McDonalds' restaurant. The McDonald Brothers had been in the restaurant business since 1937. In 1948, they closed down a successful carhop drive-in to establish the streamlined operation Ray Kroc saw in 1954. The menu was simple: hamburgers, cheeseburgers, french fries, shakes, soft drinks, and apple pie. The carhops were eliminated to make McDonald's a self-serve operation. Mac and Dick McDonald had taken great care in setting up their kitchen like an assembly line, to ensure maximum efficiency. Believing that the McDonald formula was a ticket to success, Kroc suggested that they franchise their restaurants throughout the country. When they hesitated to take on this additional burden, Kroc volunteered to do it for them. He returned to his home outside of Chicago with rights to set up McDonald's restaurants throughout the country, except in a handful of territories in California and Arizona already licensed by the McDonald brothers. Kroc's first McDonald's restaurant opened in Des Plaines, Illinois, near Chicago, on April 15, 1955, the same day that Kroc incorporated his company as McDonald's Corporation. Once the Des Plaines restaurant was operational, Kroc sought franchisees for his McDonald's chain. The first snag came quickly. In 1956 he discovered that the McDonald brothers had licensed the franchise rights for Cook County, Illinois to the Frejlack Ice Cream Company. Kroc was incensed that the McDonalds had not informed him of this arrangement. He purchased the rights back for $25,000, five times what the Frejlacks had originally paid and pressed forward. McDonald's grew slowly for its first three years. By 1958, there were 34 restaurants. In 1959, however, Kroc opened 67 new restaurants, bringing the total to 101 locations. McDonalds’ today

This wonderful phrase echoes around the world 50 million times a day, in 30,000 locations, in multitude of languages, in more than 120 countries around the globe. And this simple thought sums up the reason McDonald's has become the best known and most popular quick service restaurant around the world, quite a tribute to Ray Kroc, who founded this company nearly 50 years ago with the simple vision expressed by his phrase 'Take good care of those who work for you, and you will float to greatness on their achievements, we provide our customers with the quality of our great tasting food; our fast, friendly service; our clean restaurants and facilities; the value of our food and the McDonald's experience’. McDonald's Corporation is one of the world's largest chains of hamburger fast food restaurants, serving nearly 47 million customers daily. In...
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