A. Accounts Receivable 1. Use basic financial analysis to examine any horizontal changes in Starbucks' accounts receivable balances over time. 2. Use basic financial analysis to examine any vertical changes in Starbucks' accounts receivable balances over time. 3. Analyze how Starbucks' methods for accounting for receivables and evaluating uncollectible receivables impact the recording process and presentation of financial statements. In other words, what are this company's methods for accounting for receivables and evaluating uncollectible receivables, and how do those affect how financial information is communicated? B. Asset Acquisition, Depreciation, and Amortization: 1. Use basic financial analysis to examine any horizontal changes in Starbucks' fixed assets, intangible assets, depreciation, and amortization over time. 2. Use basic financial analysis to examine any vertical changes in Starbucks' fixed assets, intangible assets, depreciation, and amortization over time 3. Analyze Starbucks' methods for fixed asset and intangible asset acquisitions as well as depreciation and amortization, including asset categorization. How do these methods affect the balance sheet, income statement, and statement of cash flows? C. Debt Financing 1. Use basic financial analysis to examine any horizontal changes in Starbucks' short- and long-term debt over time 2. Use basic financial analysis to examine any vertical changes in Starbucks' short- and long-term debt over time. 3. Analyze Starbucks' method of debt financing. In your analysis, you should address both current and long-term liabilities, including the issuance of bonds. CONSOLIDATED STATEMENTS OF EARNINGS (in millions, except per share data) Sep 30, 2018 Oct 1, 2017 Oct 2, 2016 l Year Ende Net revenues: Company-operated stores 19,690.3 S 17,650.7 S 2,355.0 16,844.1 2,154.2 Licensed stores 2,652.2 2,377.0 24,719.5 10,174.5 7,193.2 539.3 1,247.0 1,759.0 224.4 21,137.4 301.2 3,883.3 1,376.4 499.2 191.4 (170.3) 5,780.0 1,262.0 4,518.0 (0.3) Other Total net revenues Cost of sales including occupancy costs Store operating expenses Other operating expenses Depreciation and amortization expenses General and administrative expenses Restructuring and impairments 22,386.8 9,034.3 6,493.3 500.3 1,011.4 I ,450.7 153.5 18,643.5 391.4 4,134.7 21,315.9 8,509.0 6,064.3 499.2 980.8 1,408.9 Total operating expenses 17,462.2 318.2 4,171.9 Income from equity investees Operating income Gain resulting from acquisition of joint venture Net gain resulting from divestiture of certain operations Interest income and other, net Interest expense 102.6 (92.5) 4,317.5 1,432.6 2,884.9 4,198.6 1,379.7 2,818.9 Earnings before income taxes Income tax expense Net earnings including noncontrolling interests Net earnings/(loss) attributable to noncontrolling interests Net earnings attributable to Starbucks 4,518.3 S 3.27 S 3.24 S 2,884.7 S 2,817.7 Earnings per share - basic Earnings per share -diluted Weighted average shares outstanding 1,471.6 1,486.7 Basic 1,382.7 1,394.6 1,449.5 1,461.5 Diluted STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) Sep 30, 2018 Oct 1, 2017 Oct 2, 2016 Fiscal Year Ended Net earnings including noncontrolling interests Other comprehensive income/(loss), net of tax: 4,518.0 $ 2,884.9 $ 2,818.9 Unrealized holding gains/(losses) on available-for-sale securities (7.0) (9.5) Tax (expense)/benefit Unrealized gains/(losses) on cash flow hedging instruments 53.2 (12.6) 20.1 (7.4) (38.3) (2.4) (109.6) 27.5 24.4 Tax (expense)/benefit Unrealized gains/(losses) on net investment hedging instruments (6.5) Tax (expense)/benefit Translation adjustment and other (2.2) (220.0) 3.4 85.5 19.0 Tax (expense)/benefit Reclassification adjustment for net (gains)/losses realized in net earnings for available- for-sale securities, hedging instruments, and translation adjustment 78.2 (67.2) 14.0 24.7 Tax expense/(benefit) (47.2) (174.7) 4,343.3 91.0 2,909.9 1.2 2,908.7 Other comprehensive income/(loss) Comprehensive income including noncontrolling interests 2,837.7 Comprehensive income/(loss) attributable to noncontrolling interests Comprehensive income attributable to Starbucks (0.3) 4,343.6 $ 0.2 2,837.5 $ A. Accounts Receivable 1. Use basic financial analysis to examine any horizontal changes in Starbucks' accounts receivable balances over time. 2. Use basic financial analysis to examine any vertical changes in Starbucks' accounts receivable balances over time. 3. Analyze how Starbucks' methods for accounting for receivables and evaluating uncollectible receivables impact the recording process and presentation of financial statements. In other words, what are this company's methods for accounting for receivables and evaluating uncollectible receivables, and how do those affect how financial information is communicated? B. Asset Acquisition, Depreciation, and Amortization: 1. Use basic financial analysis to examine any horizontal changes in Starbucks' fixed assets, intangible assets, depreciation, and amortization over time. 2. Use basic financial analysis to examine any vertical changes in Starbucks' fixed assets, intangible assets, depreciation, and amortization over time 3. Analyze Starbucks' methods for fixed asset and intangible asset acquisitions as well as depreciation and amortization, including asset categorization. How do these methods affect the balance sheet, income statement, and statement of cash flows? C. Debt Financing 1. Use basic financial analysis to examine any horizontal changes in Starbucks' short- and long-term debt over time 2. Use basic financial analysis to examine any vertical changes in Starbucks' short- and long-term debt over time. 3. Analyze Starbucks' method of debt financing. In your analysis, you should address both current and long-term liabilities, including the issuance of bonds. CONSOLIDATED STATEMENTS OF EARNINGS (in millions, except per share data) Sep 30, 2018 Oct 1, 2017 Oct 2, 2016 l Year Ende Net revenues: Company-operated stores 19,690.3 S 17,650.7 S 2,355.0 16,844.1 2,154.2 Licensed stores 2,652.2 2,377.0 24,719.5 10,174.5 7,193.2 539.3 1,247.0 1,759.0 224.4 21,137.4 301.2 3,883.3 1,376.4 499.2 191.4 (170.3) 5,780.0 1,262.0 4,518.0 (0.3) Other Total net revenues Cost of sales including occupancy costs Store operating expenses Other operating expenses Depreciation and amortization expenses General and administrative expenses Restructuring and impairments 22,386.8 9,034.3 6,493.3 500.3 1,011.4 I ,450.7 153.5 18,643.5 391.4 4,134.7 21,315.9 8,509.0 6,064.3 499.2 980.8 1,408.9 Total operating expenses 17,462.2 318.2 4,171.9 Income from equity investees Operating income Gain resulting from acquisition of joint venture Net gain resulting from divestiture of certain operations Interest income and other, net Interest expense 102.6 (92.5) 4,317.5 1,432.6 2,884.9 4,198.6 1,379.7 2,818.9 Earnings before income taxes Income tax expense Net earnings including noncontrolling interests Net earnings/(loss) attributable to noncontrolling interests Net earnings attributable to Starbucks 4,518.3 S 3.27 S 3.24 S 2,884.7 S 2,817.7 Earnings per share - basic Earnings per share -diluted Weighted average shares outstanding 1,471.6 1,486.7 Basic 1,382.7 1,394.6 1,449.5 1,461.5 Diluted STARBUCKS CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) Sep 30, 2018 Oct 1, 2017 Oct 2, 2016 Fiscal Year Ended Net earnings including noncontrolling interests Other comprehensive income/(loss), net of tax: 4,518.0 $ 2,884.9 $ 2,818.9 Unrealized holding gains/(losses) on available-for-sale securities (7.0) (9.5) Tax (expense)/benefit Unrealized gains/(losses) on cash flow hedging instruments 53.2 (12.6) 20.1 (7.4) (38.3) (2.4) (109.6) 27.5 24.4 Tax (expense)/benefit Unrealized gains/(losses) on net investment hedging instruments (6.5) Tax (expense)/benefit Translation adjustment and other (2.2) (220.0) 3.4 85.5 19.0 Tax (expense)/benefit Reclassification adjustment for net (gains)/losses realized in net earnings for available- for-sale securities, hedging instruments, and translation adjustment 78.2 (67.2) 14.0 24.7 Tax expense/(benefit) (47.2) (174.7) 4,343.3 91.0 2,909.9 1.2 2,908.7 Other comprehensive income/(loss) Comprehensive income including noncontrolling interests 2,837.7 Comprehensive income/(loss) attributable to noncontrolling interests Comprehensive income attributable to Starbucks (0.3) 4,343.6 $ 0.2 2,837.5 $