Financial Statements- Stockholders Equity

Financial Statements- Stockholders Equity

Microsoft Inc. and Apple Inc. are selected for this discussion. The two companies operate in the consumer electronics, software, and online services industry. The stockholder’s equity section of the financial statements is compared (Lleo et al., 2020). Comparing the financial statements for the fiscal year of 2021, the common stock and additional paid-in capital for Microsoft Corporation and Apple Inc. were $83,111,000 and $57,365,000, respectively. The retained earnings were $57,055,000 and $5,562,000 for Microsoft Inc. and Apple Inc., respectively. The accumulated comprehensive income for Microsoft Corporation and Apple Inc. was $1,822,000 and $162,000, respectively. Finally, the last item of the stockholder’s equity section of the financial year 2021 is the stockholder’s equity. Notably, the stockholder’s equity for Microsoft Corporation was $141,988,000, while that of Apple Inc. is $63,090,000.

The footnotes to the financial statements for Apple Inc. indicate that the company authorized a repurchase of $315 billion in common stock under its repurchase program. The notes also suggest that shares worth $85.5 billion, amounting to 656 million, were repurchased. The retained earnings, including the declared dividends, amounted to $14,431, and the common stock, excluding net share settlement of equity, amounted to $4,151,000. On the other part of Microsoft Corporation, a stock repurchase was authorized for a total of $40 billion under their repurchase program. Under the program, $22,970,000 worth of shares were repurchased in 2021. Common aspects are identified after comparing the notes from the two companies. For instance, the share repurchase program is common in the two companies (Bishal et al., 2021). Under the program, shares were repurchased to settle various comprehensive income needs. However, a distinctive element of the notes is the translational adjustments in stockholder’s equity to mitigate foreign currency risks arising from a transaction occurring across national borders.

References

Bishal, B. C., Bhagwat, Y. N., & DeBruine, M. (2021). Leverage Change, Share Repurchases, and Capital Expenditures. Journal of Accounting and Finance, 21(3), 99.

Lleo, S., Ziemba, W. T., & Li, J. (2020). Exploring Breaks in the Distribution of Stock Returns: Empirical Evidence from Apple Inc. Available at SSRN 3700419.

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Primary Task Response: Within the Discussion Board area, write 200-250 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions with your classmates. Be substantive and clear, and use examples to reinforce your ideas.

Select 2 companies in the same industry (for example, the home improvement industry or the candy industry).
Use the Internet to find the companies’ financial statements.
From the financial statements, list the different components from the Stockholder’s Equity section.
Read the footnotes to the financial statements to see what they disclose about their Stockholder’s Equity section.
Which parts do they have in common?
Is there anything about their shareholders’ equity that is distinctive to the business?
Share with the class what you have found.
Responses to Other Students: Respond to 2 of your fellow classmates with a reply of at least 100 words about their primary task response regarding items you found to be compelling and enlightening. To help you with your discussion, please consider the following questions:

What did you learn from your classmate’s posting?
What additional questions do you have after reading the posting?
What clarification do you need regarding the posting?
What differences or similarities do you see between your posting and other classmates’ postings?
For assistance with your assignment, please use your text, Web resources, and all course materials.