Examining Financial Statements - Landry's Restaurants Essay

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Examining Financial Statements - Landry's Restaurants

Financial statement users around the globe use financial statements to evaluate the performance of companies (Fundamentals of Financial Accounting, 2006). In order to locate a company’s reported assets, liabilities, expenses and revenues, statement users rely on four types of financial statements. The four financial statements include: Balance Sheet, Income Statement, Statement of Retained Earnings, and Statement of Cash Flows (Fundamentals of Financial Accounting, 2006, p. 6). Each of these reports provides different information to the financial statement user. The Balance Sheet reports at a point in time: a company’s assets (what it owns), liabilities (what it owes) and
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As mentioned above, the Income Statement will report Landry’s net income (or profit) during a specific period. According to the 2003 Annual Report, in the financial statement titled “Consolidated statements of Income,” Landry’s Restaurants, Inc. reported a net income of $45,901,054 in 2003 (Fundamentals of Financial Accounting, 2006, p. 626).
In the text, net income is defined as being “equal to revenues minus expenses” (Fundamentals of Financial Accounting, 2006, p. 11). In Landry’s Income Statement, revenue is listed as a single figure (indicating one source of revenue). Examining the 2003 annual report, Landry’s Restaurant Inc. reported having revenues of $1, 105,755,057 (Fundamentals of Financial Accounting, 2006, p.11).
Landry’s expenses, however, are more complex. The Income Statement shows various expense categories, including: cost of revenue, labor, administration, depreciation and amortization. In this Income Statement, net income is determined by totaling the expense categories and subtracting from the total reported revenue. Landry’s total operating costs and expenses equal $1,037,338,2939 in 2003 (Fundamentals of Financial Accounting, 2006, p. 626).
Assets
Landry’s total assets are reported in its Balance Sheet. The Balance Sheet illustrates a company’s assets, liabilities and stockholder’s equity. On December 31, 2003, Landry’s Total Assets were valued at $1,102,785,506 (Fundamentals of Financial

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