Starbucks Income Statement And Balance Sheet Analysis

Starbucks Income Statement And Balance Sheet Analysis

The current academic essay aims to discuss the income statement and the balance sheet of the Starbucks Inc. It is important to note that the general trend of the company’s development is positive. The review of the income statement reveals the constant growth of sales and revenues. Thus, the total revenue of the company has significantly increased during the last four years. In 2013, the gross profit was $8,484,500 in comparison with $12,804,800 in 2016 (Nasdaq 2017).

At the same time, the analysis of the net income indicator shows that the costs of business did not increase. Thus, net income in 2013 was $8,300 and $2,817,700 in 2016 (Nasdaq 2017). Accordingly, the company becomes more profitable, which is a positive sign in conditions of the constantly changing market.

The analysis of the Starbucks’s Balance Sheet makes it clear that the company did not make some temporary investments in the previous four years. The number of the total current assets is almost the similar in the period of 2013-2016. On the other hand, the number of the long-term assets is constantly growing with $11,516,700 in 2013 and $14,329,500 in 2016 (Nasdaq 2017). It means that the company makes long-term investments. This business decision is optimal due to the fact that the income also grows.

The credit policies of the company do not change. The number of total liabilities in 2013 was $7,036,500 and $8,445,500 in 2016 (Nasdaq 2017). Nevertheless, the positive indicator of cash and cash equivalents ensures that the company is able to pay its debts. The equity indicator of the company has also increased, which is a positive sign for the people to invest in the activities of Starbucks. It becomes clear that the future of Starbucks seems positive due to the good results represented in the company’s Income Statement and Balance Sheet. It is rational for the Starbucks’s management to use the increase in income in order to expand market influence and enter new markets.

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References

Nasdaq. (2017). Starbucks Inc. NASDAQ. Retrieved March 16, 2017 from http://www.nasdaq.com/symbol/sbux/financials?query=income-statement