what is your intake on Income Statement Microsoft\'s Income Statement is strong

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what is your intake on Income Statement Microsoft's Income Statement is strong and has been improving over the last three years. The improvements in revenue (top-line), operating performance (EBIT), and its net income (bottom line) are evident. The first piece of the improvement came from an increase in revenues 6.9% in 2010 to $62.4 billion and 11.9% to $69.9 billion in 2011. Its revenue grew more quickly than expenses. Microsoft enjoys very high Gross Margins (Revenue - COGS/Revenues) above the 70% range. This is because a big piece of its business is software that requires very little overhead. For example, the costs are electricity for powering the buildings and workstations the create the CD, DVD, or simply just downloading the software. Its Operating Expenses (Research & Development, Sales & Marketing, and General & Administrative) have been growing slower than sales so Microsoft has been able to grow its EBIT faster. The improved Operating Performance, or EBIT (increased18.3% in 2010 to $24.1 billion), lower tax rate, and lower share count (due to share repurchases) has helped Microsoft increase EPS by 29.6% in 2010 to $2.10 and 28.1% to $2.69 in 2011. This strong performance has allowed Microsoft to pay out approximately a quarter of its earnings in the form of a dividend. Balance Sheet Microsoft has a strong balance sheet. It is in a Net Cash Position (Cash less Debt), and its balance has increased by approximately $10 billion from $30 to $40 billion in 2010 to 2011. Its Current Assets far exceed its Current Liabilities and its Assets far exceed its Liabilities. MSFT's equity has increased as a result of improving financial performance (increased Revenue, EBIT, EPS, and Cash Flow) and growing cash balances.

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http://www.jblearning.com/samples/0763746037/46037_ch01_001_060.pdf

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