MICROSOFT CORPORATION 7372 - SERVICES-PREPACKAGED SOFTWARE 10-k report- http://w
ID: 2582468 • Letter: M
Question
MICROSOFT CORPORATION
7372 - SERVICES-PREPACKAGED SOFTWARE
10-k report- http://www.sec.gov/Archives/edgar/data/789019/000119312513310206/0001193125-13-310206-index.htm
Using this information answer the following question:
Balance Sheet ( You will find the answer of most of the questions from Balance Sheet):
a. Using the 10-K, show that the fundamental accounting equation, Assets = Liabilities + Stockholders' Equity, is true for your company at the end of the most recent year-end.
A _________________= L ____________________+ S.E. ___________________
b. What was your company's largest asset (net) at the end of the most recent year?
c. List the types of assets and liabilities your company has.
d. Describe in general terms what prepaid expenses are. Did your company report any prepaid expenses and other current assets account at the end of the most recent year? Where did you find this information?
e. Read the notes to financial statements. What method does your company use to determine the cost of its inventory?
f. Read the notes to financial statements. What method of deprecation does your company use?
g. What was the original cost of the property, plant and equipment held by your company at the end of the most recent year? What was the accumulated depreciation and amortization at the end of the most recent reporting year? (If the assigned company does not report the original cost of PP&E, use the net value of the property, plan, and equipment).
h. What is the amount of long-term liabilities at the end of the most recent reporting year?
i. List the accounts and amounts of your company's stockholders' equity.
All the information is provided in the link that is in the question. If you can't go to the link or need something specific please let me know
Explanation / Answer
Answer (a)
Fundamental accounting equation
Assets = Liabilities + Stockholders' Equity
$ 142,431 = $ 63,487 + $ 78,944
As per data of 10 K, fundamental accounting equation stands true for the company as total assets are equal to the sum of total liabilities and stockholders’ equity.
Note: The most recent year end is 30th June 2013, and all the amounts are in “millions”.
Answer (b)
Company's largest asset (net) at the end of the most recent year is:
Short-term investments $ 73,218
(Under the head Current Assets)
Note: The most recent year end is 30th June 2013, and all the amounts are in “millions”.
Answer (c)
List of types of assets and liabilities the company has are as under:
Asset
($ millions)
Liabilities
($ millions)
Current assets
Current liabilities
Cash and cash equivalent
3,804
Accounts payable
4,828
Short-term investments
73,218
Current portion of long-term debt
2,999
Accounts receivable (Net )
17,486
Accrued compensation
4,117
Inventories
1,938
Income taxes
592
Deferred income taxes
1,632
Short term unearned revenue
20,639
Other
3,388
Securities lending payable
645
Other
3,597
Fixed or Long term assets
Long term liabilities
Property and equipment (Net )
9,991
Long-term debt
12,601
Equity and other investments
10,844
Long-term unearned revenue
1,760
Goodwill
14,655
Deferred income taxes
1,709
Intangible assets (Net)
3,083
Others long term liabilities
10,000
Others long term assets
2,392
Answer (d)
Prepaid expenses are those expenses that are paid but not due. It means that are the expenses which are paid in advance. Generally prepaid expenses are current assets for the company, as the company has paid the expenses but yet to receive the services or product.
Yes, the company is having a prepaid expense and other current asset account at the end of 30th June 2013 (most recent year end).
The details of which are as under:
Account name
Where to find this information in form 10 K
Prepaid expense
Deferred income taxes
Part II ,Item 8,
Notes to financial statements,
Note 1 –Accounting policies
Under the head income taxes
Other current asset
Derivative Net asset
Part II ,Item 8,
Notes to financial statements,
Note 6 – Fair value measurements
(3rd Table)
Asset
($ millions)
Liabilities
($ millions)
Current assets
Current liabilities
Cash and cash equivalent
3,804
Accounts payable
4,828
Short-term investments
73,218
Current portion of long-term debt
2,999
Accounts receivable (Net )
17,486
Accrued compensation
4,117
Inventories
1,938
Income taxes
592
Deferred income taxes
1,632
Short term unearned revenue
20,639
Other
3,388
Securities lending payable
645
Other
3,597
Fixed or Long term assets
Long term liabilities
Property and equipment (Net )
9,991
Long-term debt
12,601
Equity and other investments
10,844
Long-term unearned revenue
1,760
Goodwill
14,655
Deferred income taxes
1,709
Intangible assets (Net)
3,083
Others long term liabilities
10,000
Others long term assets
2,392
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