Comprehensive Problem: Sun Microsystems

1138 WordsMay 3, 20075 Pages
Comprehensive Problem: Sun Microsystems A complete analysis was conducted on the financial statements and status of Sun Microsystems. After examining the research findings and analysis it is fair to say that evidence determines that Sun Microsystems finances has not been on a steady incline. In fact, it had definitely experienced some highs and lows in its return on investment and stockholders ' equity over a four- year evaluation from the duration of 1998 through 2001. In order to get a concise understanding of where problems are within the company 's operations the following factors were considered and examined: the annual percentage change in net income per common share diluted, net income/net revenues, the major income statement…show more content…
The difference between the net worth per share of the company and what the company is able to sell shares for greatly decreased. Changes in the industry as a whole or changes in consumer habits could be contributing factors to the change in stock values experienced at Sun Microsystems. Internally, Sun Microsystems needs to explore ways to maximize profit and minimize costs of producing goods. Business Alternatives Looking at the financial statement analysis for Sun Microsystems one can definitely see the company 's strengths and their needs. The balance sheet indicates what the firm owns and how these assets are financed in the form of liabilities or ownership interest and the statement of income is the major device for measuring the profitability of a firm over time (Block and Hirt, 2005, p.25, 28). The financial statements analysis shows that Sun Microsystems has done very well and made it through the challenge from 2000 to 2001. The stock prices dropped drastically from 2000 to 2001 and there was a huge increase in cost of sales resulting in the recommendation to outsource some of their employees to compensate for some deficit. Sun Microsystems is a very aggressive company and the employees have fought to bring the

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