Apple Financial Analysis

Topics: Balance sheet, Generally Accepted Accounting Principles, IPhone Pages: 6 (1291 words) Published: June 15, 2013
Apple Inc.

Tommaso Pavoncello
The company
Apple Inc. is an American multinational corporation that designs and markets consumer electronics, computer software, and personal computers. The company's best-known hardware are the Macintosh computers, the iPod, the iPhone and the iPad. Apple has recently been the largest technology company in the world by revenue and profit. Founded by Steve Jobs on April 1, 1976 in Cupertino, California, the company was previously named Apple Computer, Inc., for its first 30 years, but removed the word "Computer" on January 9, 2007, to reflect the company's ongoing expansion into the consumer electronics market in addition to its traditional focus on personal computers. As of September 2010, Apple had 46,600 full time employees and 2,800 temporary full time employees worldwide and had worldwide annual sales of $65.23 billion. On the 5th of October of 2011 the founder of Apple Inc. died at his home in Palo Alto, California, aged 56, six weeks after resigning as CEO of Apple. A copy of his death certificate indicated respiratory arrest as the immediate cause of death. The death of Steve Jobs didn’t stop the Apple Inc. and the presentation of new, innovative products; in fact recently has been presented the new iPhone 4s, the latest version of the legendary smart phone.

Consolidated Balance Sheet

Most significant variation
* The account “Cash and cash equivalence” decreases from 13% probably due to new investments and acquisition of new assets (for example intangible assets) * The account “intangible assets” in fact increases of 934% * The account “inventories” is computed using the first-in, first-out method, or market. If the cost of the inventories exceeds their market value, provisions are made currently for the difference between the cost and the market value. The Company’s inventories consist primarily of components and finished goods for all periods presented. The account decreases from 26% probably because there have already been a decrease in cash so they avoid new expenses to limit the decrease, or due to the period of the year (increase in sales due to the presentation of a new product) * The account “property, plant and equipment increases of 63% after the purchase of new machinery or buildings. The investment could justify the decrease in the account “cash and cash equivalence”. ” Depreciation is computed by use of the straight-line method over the estimated useful lives of the assets, which for buildings is the lesser of 30 years or the remaining life of the underlying building, up to five years for equipment. Depreciation and amortization expense on property and equipment was $1.6 billion, $815 million and $606 million during 2011, 2010 and 2009, respectively. * The account “goodwill” increases of 21% probably due to a new investment. In fact Apple inc. purchased the company “C3 Technologies” during the 2011 and it also acquired Nortel Networks Corporation’s patent portfolio for an overall purchase price of $4.5 billion; the difference between the purchase price and the sum of the fair value of the net assets is by definition the value of the "goodwill" of the purchased company. * The account “Total assets” increases of 55% due to new investments of the company

RATIOS
Quick ratio: This measures Apple’s ability to meet its obligations without selling off inventory; the higher the result, the better. It is expressed as current assets minus inventories, divided by current liabilities. September, 25 2010

current assets-inventorycurrent liabilities= 41678-105120722= 1,96:1 September, 24 2011
current assets-inventorycurrent liabilities= 44988-77627970= 1,58:1 Current ratio: The Current ratio is simply working capital expressed as a ratio. It measures also the liquidity of a company and its to meet his short-term obligations. September 25, 2010

current assetscurrent liabilities= 4167820722= 2,01:1
September 24,2011
current assetscurrent...
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