Written Report

Required:

Obtain 2016-2022 annual reports from a corporation of your choice (excluding regulated industries such as financial and utilities industries). Obtain the relevant authoritative literature using the FASB Accounting Standards Codification (aka FASB ASC); you can gain access at this website (https://asc.fasb.org). Using knowledge you obtained from chapters 13 and 14 and any analysis you consider useful, respond to the following questions.

Note: You can obtain electronic copies of annual reports from EDGAR (Electronic Data Gathering, Analysis, and Retrieval; http://www.sec.gov/edgar/searchedgar/companysearch.html). EDGAR performs automated collection, validation, indexing, and forwarding of submissions by companies and others who are required by law to file forms with the SEC. All publicly traded domestic companies use EDGAR to make the majority of their filings. Form 10-K, which includes the annual report, is required to be filed on EDGAR and the SEC makes this information available on the Internet. You can also obtain electronic copies of annual reports from company websites (usually under “Investor Relations”). Do not use quarterly reports (i.e., Form 10-Q).

I CHOOSE STARBUCKS TO COMPUTE.

QUESTION: Compute the debt to equity ratio for fiscal years 2016-2022. How has the proportion of debt financing and equity financing changed over years? The average ratio for the stocks listed on the New York Stock Exchange in a comparable time period was 0.96. Is the corporation experiencing favorable or unfavorable financial leverage (Hint: calculate and compare the return on assets and return on shareholders’ equity)? Prepare an exhibit/table/graph/chart to support your discussion.

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