Company study and financial statements

Overview

Accountants must be familiar with finding and interpreting data in a company’s balance sheet and income statement. They will take these documents and create a condensed version showing multiple years to review changes. It is important for accountants to understand the categories of the balance sheet and income statement, and the types of ratios discussed in the financial statements. This information is reported to stakeholders by accountants.

Directions

Use Nike’s SEC 2022 10-K filing in the

Supporting Materials

section to complete this assignment. There are two parts for this assignment: the condensed financial statements and the summary.

Module Two Workbook Template

In the condensed financial statements part of this assignment, you will use the company’s Securities and Exchange Commission (SEC) 2022 10-K filing to build a condensed version of the balance sheet and income statement in the Module Two Workbook Template linked in the

What to Submit

section. The SEC 2022 10-K filing will provide three years of income statements and only two years of balance sheets. You will need to find Nike’s 2020 Form 10-K filing on the SEC website to pull the 2020 balance sheet to complete the template.

Categories will be different than what you find in the annual report. Use your best judgement when classifying them. If you need to lump certain costs together, then do so. Make certain you keep accounts in the correct category (i.e., current assets, non-current assets, current liabilities, long term liabilities, and owner’s equity). Each of these sections has an “other” category you can use. It is important to use the correct categories to have ratios calculate correctly. For example, the company shows cost of sales of $100K, general and administrative (G&A) expenses of $50K, and marketing expense of $10K. Combine the G&A and marketing expenses in the single line on the income statement called “Sales, General, and Administrative Expenses” in the amount of $60K.

The template will provide a check digit for the Balance Sheet and Income Statement tabs. It will help with ensuring the Balance Sheet tab is balanced and the Income Statement tab net income is correct before tax.

In the template, the ratios auto-calculate. You will not need to analyze the Ratio tab for historical data. You will only use the Ratio tab for explanatory purposes to complete the

Module Two Summary Template

.

Note:You may choose to complete an assignment using a desktop program instead of SNHU’s virtual desktop (VDI); however, technical support will not be provided by SNHU if you select this option.

Module Two Summary Template

Complete Module Two Summary Template linked in the What to Submit section.

Specifically, you must address the following rubric criteria:

Module Two Workbook Template

1. Prepare the company’s balance sheet accurately and completely on the Balance Sheet tab in the workbook. Include the following detail in your response:Provide all data available from May 31, 2020, to May 31, 2022.
2. Prepare the company’s income statement accurately and completely on the Income Statement tab in the workbook. Include the following details in your response:Provide all data available from May 31, 2020, to May 31, 2022.

Module Two Summary Template

1. Define the measurement of each type of ratio and the accounts included in the calculation. Refer to the Ratios tab.
2. Explain the significance of each ratio to the company.
3. Identify an asset or liability being measured at fair value. Include the following details in your response:Provide the specific disclosure note(s).Include the citation(s).
4. Provide the classification for the GAAP standard that allows the fair value measurement.

If you need writing support, access the Academic Support module of your course.

What to SubmitModule Two Workbook Template

Submit the Module Two Workbook Template with the following tabs completed: Balance Sheet, Income Statement, Ratios.

Module Two Summary Template

Submit your completed Module Two Summary Template as a 2- to 4-page Microsoft Word document with double spacing, 12-point Times New Roman font, and one-inch margins. Sources should be cited according to APA style.

Supporting Materials

The following resources support your work on the project:

Website:

Nike’s SEC 2022 10-K Filing

This resource provides Nike’s 2022 10-K. Read through the material in Item 8: Financial Statements and Supplementary Data and through the Notes To Consolidated Financial Statements section. It is not necessary to click on additional links on the website for this assignment.

Website:

Nike’s SEC 2021 10-K Filing

This resource provides Nike’s 2021 10-K. Read through the material in Item 8: Financial Statements and Supplementary Data and through the Notes To Consolidated Financial Statements section. It is not necessary to click on additional links on the website for this assignment.

Website:

Generally Accepted Accounting Principles (GAAP)

The resource provides access to the GAAP standard through the Financial Accounting Standards Board (FASB). Select “Basic View” to access the standards.

Nike, Inc.
Balance Sheet
For Period May 31, 2020 through M
(in millions)
Financial Statements
2020
2021
[insert value]
[insert value]
[insert value]
[insert value]
$
–
[insert value]
[insert value]
[insert value]
[insert value]
$
–
–
Assets
Current Assets
Cash and Cash Equivalents
Accounts Receivable Net
Inventory
Other Current Assets
Total Current Assets
Non-Current Assets
Property, Plant and Equipment Net
Intangibles
Other Assets
Total Non-Current/Fixed Assets
[insert value]
[insert value]
[insert value]
$
–
[insert value]
[insert value]
[insert value]
$
Total Assets
$
–
$
–
–
[insert value]
[insert value]
[insert value]
$
–
–
Liabilities and Owners’ Equity
Current Liabilities
Accounts Payable
Accrued Expenses and Other Current Liabilities
Current Portion of Debt and Leases
Total Current Liabilities
[insert value]
[insert value]
[insert value]
$
Long-Term Liabilities
Long-Term Debt and Lease Obligations
Other Long-Term Liabilities
Total Long-Term Liabilities
[insert value]
[insert value]
$
–
[insert value]
[insert value]
$
Total Liabilities
$
–
$
–
–
–
Owners’ Equity
Common Stock, Less Treasury
Additional Paid in Capital
Retained Earnings
Other Equity
Total Equity
[insert value]
[insert value]
[insert value]
[insert value]
$
–
[insert value]
[insert value]
[insert value]
[insert value]
$
Total Liabilities & Equity
$
–
$
Check Digit: This should be 0 or your balance sheet is out
of balance. Check your work.
$
Check Digits
Total Current Assets
Total Assets
Total Current Liabilties
Total Liabilities
Total Equity
$
$
$
$
$
–
20,556.00
31,342.00
8,284.00
23,287.00
8,055.00
$
$
$
$
$
$
–
26,291.00
37,740.00
9,674.00
24,973.00
12,767.00
Nike, Inc.
Balance Sheet
ay 31, 2020 through May 31, 2022
(in millions)
atements
2022
Vertical Analysis, Common Size Statements
2020
2021
2022
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
[insert value]
[insert value]
[insert value]
$
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
$
–
#VALUE!
#VALUE!
#VALUE!
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
[insert value]
[insert value]
$
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
$
–
#VALUE!
#VALUE!
#VALUE!
[insert value]
[insert value]
[insert value]
[insert value]
$
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
$
–
#VALUE!
#VALUE!
#VALUE!
[insert value]
[insert value]
[insert value]
[insert value]
$
[insert value]
[insert value]
[insert value]
$
$
$
$
$
$
$
–
28,213.00
40,321.00
10,730.00
25,040.00
15,281.00
Nike, Inc
Income Statement
For May 31, 2020 through May
(in millions)
Financial Statements
Total Revenue (or Sales)
Cost of Sales
2020
[insert value]
[insert value]
Gross Profit
Sales, General and Administrative Expenses
#VALUE!
[insert value]
Operating Income
#VALUE!
[insert value]
#VALUE!
Other Income (Expense) *If income is reported, enter as a negative number.
Interest Income / (Expense)
[insert value]
Other Income (Expense)
[insert value]
Net Income (Loss), Before Tax
Check Digit for Net Income (Loss) , Before Tax
2021
[insert value]
[insert value]
#VALUE!
[insert value]
[insert value]
#VALUE!
$
2,887.00 $
#VALUE!
6,661.00
Nike, Inc
Income Statement
r May 31, 2020 through May 31, 2022
(in millions)
tatements
2022
[insert value]
[insert value]
#VALUE!
[insert value]
#VALUE!
[insert value]
[insert value]
#VALUE!
$
6,651.00
Vertical Analysis, Common Size Statements
2020
#VALUE!
#VALUE!
2021
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
mon Size Statements
2022
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
Nike, Inc.
Ratio Analysis
For Period May 31, 2020 through May 31, 2022
2020
2021
2022
#DIV/0!
#VALUE!
$
–
#DIV/0!
#VALUE!
$
–
#DIV/0!
#VALUE!
$
–
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
Liquidity Ratios
Current Ratio
Quick Ratio
Working Capital
Activity Ratios
Receivable Turns
Days in Receivables
Revenues/Working Capital
Revenues/Fixed Assets
Revenues/Total Assets
Inventory Turns
Days in Inventory
Payables Turns
Days in Payables
Coverage/Leverage Ratios
Fixed Assets/Equity
Profitability Ratios
Return on Equity
Return on Total Assets
Net Profit on Revenues
ACC 345 Module Two Summary Template
1. Define the measurement of each type of ratio and the accounts included in the
calculation. Refer to the Ratios tab.
[Insert text.]
2. Explain the significance of each ratio to the company.
[Insert text.]
3. Identify an asset or liability being measured at fair value. Provide the specific disclosure
note(s). Include the citation(s).
[Insert text.]
4. Provide the classification for the GAAP rule that allows the fair value measurement.
[Insert text.]
References
Include any references used to complete this assignment. This section is for the full citation.
Sources should be cited using APA style.
[Insert text.]