Refer to Apple Inc.'s consolidated financial statements in Appendix A and online in the filings section of

Question:

Refer to Apple Inc.'s consolidated financial statements in Appendix A and online in the filings section of www.sec.gov.

Requirements

1. Did accounts payable for Apple Inc., increase or decrease in 2014? Calculate accounts payable turnover for 2s014. How many days does it take Apple Inc. to pay an average account payable? Comment on the length of the period in days.

2. Examine Note 5-Income Taxes-in the Notes to Consolidated Financial Statements. Income tax provision is another title for income tax expense. What was Apple Inc.'s income tax provision in 2014? Is the income tax provision likely to be equal to the amount Apple Inc. paid for its taxes in 2014? Why or why not? What was the company's effective tax rate in 2014?

3. Examine Note 6-Debt. Did Apple Inc., borrow more or pay off more long-term debt during 2014? How can you tell? What was the company's effective interest rate on its long-term debt? Why do you think this rate was so low? (Challenge)

4. Examine Note 10-Commitments and Contingencies-in the Notes to Consolidated Financial Statements. Describe some of Apple Inc.'s commitments and contingent liabilities as of September 27, 2014. Are any of these amounts included in the numbers in the balance sheet line items?

5. How would you rate Apple Inc.'s overall debt position-risky, safe, or average? Compute three ratios at September 27, 2014, and September 28, 2013, that help answer this question.

Contingent liabilities
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Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...