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Statement of Cash Flows When comparing statement of cash flows between the two electronic companies, they both compliment each other. This meaning where one company lacks the other makes up for. On the brief overview of the companies, Apple looks to be the stronger company. Their net income over the last three years almost doubles Microsoft net income in the same period of time. Both companies keep a steady depreciation rate over the three year time frame. Neither company takes a drastic dip or varies more than about a million dollars. The only difference is

Microsoft spends less in depreciation each year, coming in about four million dollars lower than what Apple spends yearly. This could be caused by multiple things. Microsoft is a
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Apple generates revenues from product sales, subscription fees associated with iCloud and Apple Music, and extended warranty fees for its products. Apple also generates revenues from the fees charged to content owners and application developers for selling their digital content and applications through the iTunes Store, App Store, Mac App Store, iBook’s Store, and Apple TV App Store.

The current ratio helps investors and creditors understand the liquidity of a company and how easily that company will be able to pay off its current liabilities. This ratio expresses Apple and Microsoft current debt in terms of current assets. Therefore, in 2016 Microsoft’s current ratio was 2.35 means that the Microsoft has 2.35 times more current assets than current liabilities. However, Apple is current debt in terms of current assets. Is only 1.35 that the Microsoft has 1.35 times more current assets than current liabilities. A higher current ratio is always more favorable than a lower current ratio because it shows the company can more easily make current debt payments.

Figure 1

Figure 2

Higher quick ratios are more favorable for companies because it shows there are more quick assets than current liabilities. In 2016, Apple with a quick ratio of 1.22 indicates that quick assets equal current assets. This also shows that

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