SEC 10K: Income Statement - COSTCO Locate the income statement in your company’s
ID: 2422039 • Letter: S
Question
SEC 10K: Income Statement - COSTCO
Locate the income statement in your company’s most recent 10-K, and respond to the following questions. Sometimes the income statement is called Consolidated Statements of Earnings, Consolidated Statements of Operations, or something similar.
http://phx.corporate-ir.net/phoenix.zhtml?c=83830&p=irol-SECText&TEXT=aHR0cDovL2FwaS50ZW5rd2l6YXJkLmNvbS9maWxpbmcueG1sP2lwYWdlPTEwNTI0MTM0JkRTRVE9MCZTRVE9MCZTUURFU0M9U0VDVElPTl9FTlRJUkUmc3Vic2lkPTU3#sD5DA86177F33EC84CEA9D3EF14FC1730
By the way, you should ignore the Statement of Comprehensive Income because that's a financial statement covered in more advanced accounting classes. We won't be doing anything with that statement in our introductory accounting class.
Category: Revenue and Net Income
Identify the following amounts for the two most recent years:
Net Sales (or Total Sales if your company has more than one source of revenue) Some companies use the term Revenue instead of Sales.
Cost of Goods Sold (aka Cost of Products, Cost of Sales, Cost of Services, etc.)
Gross Profit (aka Gross Margin)
Category: Analysis
Calculate the following ratios (show and label your calculations) for the two most recent years and comment on the results of your ratio analysis.
Gross profit margin = Gross profit ÷ Net sales × 100
Net profit margin = Net income ÷ Net sales × 100
Example: Johnson & Johnson (J&J)
Use this example as a guide for answering these discussion questions for your company. For this example, please refer to the J&J's Consolidated Statements of Earnings on page 21 of its 2014 10-K.
And here are J&J’s ratios:
2014 2013 Calculation Sales to customers $74,331 $71,312 amount given in 10-K Cost of products sold 22,746 22,342 amount given in 10-K Gross profit $51,585 $48,970 Sales Cost of products soldExplanation / Answer
The required table is as below:
Particulars
2015
2014
Total revenues
$116,199
$112,640
Cost of goods sold (aggregate of operating expenses)
$112,575
$109,420
Gross profit (Operating income)
$3,624
$3,220
Net income
$2,377
$2,058
Gross profit margin of 2015 = (Gross profit / Net sales) × 100
= ($3,624 / $116,199) × 100
= 3.1%
Gross profit margin of 2014 = (Gross profit / Net sales) × 100
= ($3,220 / $112,640) × 100
= 2.9%
Net profit margin of 2015 = (Net profit / Net sales) × 100
= ($2,377 / $116,199) × 100
= 2%
Net profit margin of 2016 = (Net profit / Net sales) × 100
= ($2,058 / $112,640) × 100
= 1.8%
Particulars
2015
2014
Total revenues
$116,199
$112,640
Cost of goods sold (aggregate of operating expenses)
$112,575
$109,420
Gross profit (Operating income)
$3,624
$3,220
Net income
$2,377
$2,058
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