Starbucks Liability

3. The primary assets that Starbucks holds are outlined on the balance sheet. The biggest category of asset is with plant, property and equipment. The notes to

The Starbucks Corp. is an American coffee company and coffeehouse chain based in Seattle, Washington. Founded in 1971, Starbucks is now the largest coffeehouse company in the world, with 23,132 stores in 65 countries and territories. Starbucks does not have a public religion. Their mission: to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time. Starbucks changed their Christmas cup to a plain cup. Some people believe it was a strike against christianity. Others think it was just an innocent thing to do.

Starbuck’s consolidated net revenue grew 17% to $19.2 billion, from 2014. Their non-GAAP (adjusted-generally accepted accounting principles) operating income was up 19% to $3.7 billion, over their 2014 total. Their non-GAAP operating margin was at 19%, which increased 50 basis points from 2014. Starbucks earnings per share also grew to $1.58, a $.25 (18.8%) increase from 2014. These increases and growth made it possible to return $2.4 billion to shareholders. This money was returned in the form of dividends and share buybacks, up 50% from 2014 (“Starbucks Fiscal”, 2016).

Financial controls have been another key component to Starbucks’ success. They monitor the individual cash flow from each store all the way up to the CFOs of Starbucks. Store managers can determine the stores needs based on proper information from the financial controls. An effective illustration of this is Starbucks’ more than 550 specialty cafes and kiosks in North America (Starbucks, 2010). The kiosks serve freshly brewed coffee to the public and provide instant

The succeeding content of this executive summary provides an analysis on Starbucks’ Corporation profit using the company’s most three most recent annual reports. Team B uses “the information contained in the company’s balance sheet and income statement noting that annual reporting period and fiscal year mean year-end numbers. Additionally, included is the company history, audit for the company, stock exchange listing, cash and cash equivalents at the end of its 2 most annual reporting periods. Moreover, total current assets, largest current assets, company’s total assets at the end of its 2 most recent annual reporting years. Furthermore, accounts payable,

The determinants of Starbucks profitability over time are variable costs and fixed costs. “A variable cost is a cost that change in direct proportion to a change in the level of activity (dict). Variable costs for Starbucks would include labor, coffee beans, dairy, and plastic products. A fixed cost is indirect costs of business expenses that remain unchanged (dict). Fixed costs for Starbucks include rent, taxes, and insurance as well as advertising. In the figure below (fig 1) we have Starbucks financial data in millions for the year of 2015. This includes their operating expenses, net revenues, such as company-operated stores, licensed stores, CPG, food service. It also includes their total net revenues and their balance sheet. As we can see “Operating costs dropped in the fiscal year

In the inventories section, they are directed at the lower of cost (primarily moving average cost) or market. Starbucks records inventory reserves for obsolete and slow-moving inventory and for estimated shrinkage between physical inventory counts. According to trends, inventory reserves are based on inventory obsolescence, historical experience and application of the specific identification method. As of September 27, 2015 and September 28, 2014, inventory reserves were $33.8 million and $31.2 million, respectively. We see that the carrying amount (lower of cost or market) as of the balance sheet date of inventories less all valuation and other allowances. Excludes noncurrent inventory balances (expected to remain on hand past one year or one operating cycle, if longer).

Starbucks financial statements were analyzed for the fiscal year ended September 27, 2015. Like all public companies, annual and quarterly financial statements are required to allow regulators and other interested parties to analyze the financial status and management decision making of the company. This analysis focuses on the results of Starbucks most recent published annual report containing their balance sheets, statement of earnings and cash flows. These statements will be analyzed against the results of one of its competitors, Dunkin Donuts, to investigate how the two companies compare to each other. It was noted that Starbucks and Dunkin Donuts do not have corresponding fiscal year ends. The data therefore is not directly comparable since the reports do not reflect the same time period of data but should provide additional insight. The paper will attempt to provide a brief analysis of Starbucks operations in terms of its liquidity, leverage, activity, profitability and growth ratios used by analysts in the industry.

Some groups support Starbucks, and others do not. The Starbucks side says that they allow guns at their stores. But the opposing side says that the guns are a safety hazard, and they can hurt people at the stores. What I think about this is that the guns should not be allowed at the shops. This just makes it unsafe for some everyday Starbucks customers, like me. I feel that just having a gun by your side is a huge safety hazard, not only because one shot can kill a human, but because their might be a conflict between two people and then the gun might be used to settle the conflict.

Starbucks Corps had its gross account receivables for the year 2015 increase by 14.44% which led to its net receivables increase by $88,000,000 which translates to an increase of 13.95% of the net account receivables. This was followed by an increase in doubtful debts through the previous year by 6.12% to %6,700,000 from the ear 2014. This is due to the increase in the number also sales which led to the increase in account receivables and also doubtful debts in 2015. The risk that the company undertook also increases in line with the increase in account receivables.

Starbucks strategies have successfully made them one of the biggest names in the coffee market globally. Starbucks has been able to survive the high competitive market and to differentiate themselves from other coffee shops by producing high quality coffee. Also, Starbucks successfully create a huge numbers of loyal customers worldwide by providing great services and high quality products. Starbucks was able to survive 2008 financial crisis successfully. In 2008, Starbucks net income was -53% that means Starbucks was losing so much many yet, 2009 Starbucks was able to not only stop their losses but also to gain a profit of 24%. However, Starbucks should be worry from the possibility of another financial

Starbucks’ Total fixed assets increased from $3,200.5 billion in 2013 to $3,519 billion in 2014. This was a 9.95% increase. As a percentage of total assets on the balance sheet, fixed assets increased from 27.79% to 32.73% (Starbucks,

Starbucks generates strong cash flows has solid liquidity. The company executes rigorous cost cutting initiatives to improve its bottom-line. However, throughout fiscal 2008, Starbucks continued to experience declining revenue, particularly in US operation. The decline is largely attributed to lower customer traffic.

Starbucks’ shares have grown more than 1500% over the past decade. Financially, it has been an oak tree in an ever changing economy with customers that have ever changing demands. However, there has been increased concern for the financial viability of the coffee shop a recently announced plan to close down over 600 stores that were said to be underperforming domestically. That means that more than 1,000 jobs will be eliminated. As scary as that is on the local front to top management, the executive staff feels that it is the only way to recover from it’s shocking $108.7M loss for the 2nd quarter this fiscal year.

The horizontal analysis in the balance sheet reports that the amount and percentages from 2015 to 2016 increased in all but two assets. The cash and cash equivalents increased by 39%, total currents assets increased by $789.50 or 20%, and property, plant and equipment, net increased from $4,088.30 to $4,533.80, an increment of 11%. This indicates that Starbucks improved its ability to collect from its customers, while also expanding across the