Atthapol Charoenkietkrai ACG2021 Section 2

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Gwendoline Rice
8 years ago
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1 Atthapol Charoenkietkrai ACG2021 Section 2

2 Amazon has been in a good position for the last few years and still on a rise. The assets have increased, and the debt has decreased. The company has exponentially produced large amount of money over the last couples years. GlsZElEPS0xfFR5cGU9Mw==&t=1

3 Jeffrey P. Bezos is the Chief Executive Officer and Chairman of the board. Offices are located in th Avenue South, Suite 1200 Seattle, Washington The fiscal year has ended on December 31, 2008 The company provides access for people to buy and sell retail items through World Wide Web. They are the largest retailer in the world. The company has many offices in every major countries throughout the world, but there is only one main office which locates in Seattle, Washington

4 Ernst & Young LLP are the company s independent auditors. They have conducted their audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). The audit includes examining, on a test basis, evidence supporting the amounts, and disclosures in the financial statements, assessing the accounting principles used, significant estimates made by management, and evaluating the overall financial statement presentation.

5 Amazon.com inc. or as known as AMZN on NASDAQ has the current stock price at $ by Feb 23 11:57am ET 52 weeks trading range from $ Amazon does not pay dividends February 23 11:57am ET The company stock s market is practically unstable. It can be extremely low or high. I would carefully observe the past and present the company s stock market before I buy or sell.

6 Amazon is one of the fastest growing company because of their balance sheet which provides flexibility for growth, acquisitions, and share buybacks. They also offer new products to consumers to help improve buying efficiency. However, Amazon is in a very competitive market. They have many rival companies such as, Yahoo!, ebay, and Microsoft. Amazon has to keep their consumers demand high at all time.

7 The company is a multi-step process The company has generated large amount of amount of money over the year by increased gross profit, net income, and income from operations by 30-35% approximately Fiscal Year (Numbers are in millions of dollars for all charts) Gross Profit Net Income Income from operations

8 Assets Current asset Cash and cash equivalents Marketable securities Inventories Account receivable, net and other Deferred tax asset Total current assets Fixed assets, net Deferred tax assets Goodwill Other assets Total assets

9 L I A B I L I T I E S A N D S T O C K H O L D E R S E Q U I T Y Current liabilities Accounts payable Accrued expenses and other Current portion of long-term debt Total current liabilities Long-term debt Other long-term liabilities Total liabilities Preferred stock, $0.01 par value: Authorized shares 500 Issued and outstanding shares none Common stock, $0.01 par value: Authorized shares 5,000 Issued shares 445 and 431Outstanding shares 428 and Treasury stock, at cost (600) (500) Additional paid-in capital Accumulated other comprehensive income (loss) (123) 5 Accumulated deficit (730) (1375) Total stockholders equity Total liabilities and stockholders equity

10 According to the balance sheet, 2008 was a better year for company than It has produced more money, and it got rid most of debt at the same time. Total assets has increased almost 2000 millions. The account that has the most changes is Additional paid-in capital from 3063 to 4121 millions.

11 Net cash provided by operating activities are greater than net income for both 2007 and The company is growing through investment activities, mostly by the purchasing of fixed assets and marketable securities. the company s primary source of financing is tax benefits from stock-based compensation. The company s cash has increased over 230 millions over the past 2 years.

12 Product sales revenues from product sales are recognized when earned. Amazon records the net sale as revenues rather than the gross sale price unless it has title to the inventory and control over the selling price. Amazon also estimates sales returns and reports only net sales, that is, gross sales less an allowance for sales returns. The topics to the Notes to the Financial Statements are as follows: Cash and Cash Equivalents, Inventories, Accounts Receivable,, Internal-use Software and Website Development, Depreciation of Fixed Assets, Leases and Asset, Goodwill, Other Assets, Investments, Long-Lived Assets, Accrued Expenses and Other, Unearned Revenue, Income Taxes, Revenue, Shipping Activities, Cost of Sales, Vendor Agreements,, Technology and Content, General and Administrative, Stock-Based Compensation, Foreign Currency, Recent Accounting Pronouncements, Reclassifications, Tax Contingencies, Capital Leases, Commitments, Pledged Securities, Legal Proceedings, Inventory Suppliers, Common Stock

13 Working Capital 2008 = 1411, 2007 = 1450 Working Capital has increased $ 39 millions Current Ratio 2008 = 1.29, 2007 = 1.39 Current Ration has decreased 0.1 Receivable turnover 2008 = 23.17, 2007 = The company turned inventory into cash 2.13 times more than 2007 Average days sales uncollected 2008 = 15.75, 2007 = The company takes 1.59 days less to collect accounts receivable Inventory turnover 2008 = 12, 2007 = 13 It takes the company 1 less times for inventory to be sold. Average days inventory on hand 2008 = 30.41, 2008 = Number of days taken to sell inventory on hand has increased by 2.34 days

14 Profit margin 2008 = 33.74%, 2007 = 32.08% The percentage of each dollar that resulted in net income increased by 1.66% Asset turnover 2008 = 2.59, 2007 = 2.73 The efficiency in which assets were used to produce sales decreased.14 times Return on assets 2008 = 8.71%, 2007 = 8.77% The profits from assets have decreased 0.06% Return on equity 2008 = 33.34%, 2007 = 65.97% The amount investors earned decreased 32.63%

15 Debt to equity 2008 = 2.11% 2007 = 4.41% The company has 2.3 less debt to the creditors but still has high ratio.

16 Price/earnings per share = 0 Dividend yield : Amazon does not give out dividends

AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions)

AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) CONSOLIDATED STATEMENTS OF CASH FLOWS CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD $ 8,084 $ 5,269 $ 3,777 OPERATING ACTIVITIES: Net income (loss) 274 (39) 631 Adjustments to reconcile net income (loss)