I’m working on a Computer Science question and need guidance to help me study.
Initial forum post will be to research and discuss the following topic. The balance sheet is a “snapshot” of a company’s financial conditions on a specific date. One way to look at a balance sheet is in terms of the “sources” and “uses” of cash. Of what use is the balance sheet to potential investors in the company? Research on the Internet an example of a balance sheet of a large company and view its balance sheet online. Briefly summarize your findings. This post should be a minimum of 250 words.
Response to classmates:
Your follow-up posts may add additional insights to a classmate’s opinions or may challenge posted opinions. Use examples from the readings, or from your own research to support your views as appropriate. Responses to classmates should be a minimum of 150 words.
- The balance sheet is just one of 4 financial statements, the other 3 are income statements, statements of cash flow, and statements of owner equity. Income statement “shows net income or net loss” ( Hood, n.d.). This statement basically shows and tracks all the money coming in and going out. Balance sheet “contains assets, liabilities, and owners or shareholders equity” (Hood, n.d.). The balance sheet shows how assets are funded, either with liabilities, such as debt or stockholders equity, such as retained earnings and additional paid-in capital. Why is the balance sheet important to investors? It’s important to investors because the sheet shows how much a company is actually worth. It can show the value of all the assets and how much debt a company has taken on. Statement of Cash Flow, this tells you where all of your cash went and how well a company generates cash to pay their obligations. The last statement is statement of owner equity, the components into this statement are 1) Beginning equity balance, 2) Additions and subtractions 3) Ending balance. The balance sheet I viewed is from Exxon Mobil of September 30, 2018. It shows their total assets that were $354, 628, Its added up at the end of viewing their assets. Then it shows their total liabilities which were $157,797. Total equity is shown which is $196,831 this shows the reinvested parts and shares. At the very end of the statement it shows the total equity and liabilities. By viewing this and understanding these statements you can judge the businesses direction it’s headed in the future.
Hood, E. (n.d.). The Four Basic Types of Financial Statements: Get Help With All Types of Financial Reports for Your Business From Ignite Spot. Retrieved from https://www.ignitespot.com/the-four-basic-financial-statements
- When we look at a balance there is a large amount of information that we have sort through and learn from. Investors look at this information and make informed decisions about how to move forward with their investments. While all of the information is present the main themes are present and highlighted for the readers. Assets, liabilities, and shareholders equity are the main objects of the balance sheet and these numbers help provide a deeper dive into why investors make the decisions that they do. The balance sheet will help investors decide on how they proceed with areas of development and implementation of the new idea or creations. While researching balance sheets I decided to dive into Activision Blizzard Inc’s balance sheet. While reading their balance sheets from 2015 through 2019 I have found that the company acquired a large number of assets in 2016 going into 2017. While downward trending in the market Activision Blizzard Inc is still known as one of the leading game developing titans in the industry. Through the use of the balance sheet, we can conclude that the investors have and still are creating and investing in the right areas to maintain profitability. Without the proper accounting tools, investors would be left in the wind and their investments wouldn’t be as impactful because the required information to intelligently invest would be much harder to obtain.
ATVI: Activision Blizzard Inc. Annual Balance Sheet. (2019). Retrieved June 03, 2020, from https://www.marketwatch.com/investing/stock/atvi/f…
Silva, D. (2020, March 10). What Is a Balance Sheet, and How Do You Read One? Retrieved June 03, 2020, from https://smartasset.com/investing/balance-sheet
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