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Week 7 BUS 1102 Written Assignment
Basic Accounting (Bus 1102)
University of the People
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Week 7: written assignment University of the People BUS 1102 Basic Accounting 21 October 2020
For this written assignment I decided to write about Apple Inc. as soon as this is a very famous corporation that sells its products all over the world and seems to be very successful. “In August 2018, Apple became the first publicly traded U. company to be valued at over $1 trillion and just two years later in August 2020 became the first $2 trillion U. company.” (Technology Desk, 2020).
A ticker symbol of this company is AAPL. You can find its K-10 form on this link: sec/ix?doc=/Archives/edgar/data/320193/000032019319000119/a10- k20199282019.
The thing I expected to see in the reported Statement of Cash Flows was the Net Income value. “Net income is carried over from the income statement and is the first item of the cash flow statement.” (Murphy, 2020). In fact, one of the main reasons of checking cash inflows and outflows is to compare the cash from operations to Net Income, so it is not surprising that we can see this value in such document.
The thing I did not expect to see in the reported Statement of Cash Flows was the Repurchase of common stock in the Financing Activities category. I thought, that this value should be shown in the Investment Activities category, as soon as “Investing activities in accounting refers to the purchase and sale of long-term assets and other business investments” (FreshBooks, n.). However, I have learned that a Repurchase of common stock is an action of buying back your own shares from the marketplace, and that financing activities are about raising capital of the company and paying it back to investors. I think, that this value was written there because “reducing the number of shares means EPS, revenue, and cash flow grow more quickly” (Banton, 2020).
To be honest, I would say that investing in Apple Inc. is a good idea even without checking the Statement of Cash Flows. This company is so big and successful, that
References
Caroline Banton. (September 23, 2020). Share Repurchase. Retrieved from investopedia/terms/s/sharerepurchase.asp
Chris Murphy. (April 23, 2020). How Do Net Income and Operating Cash Flow Differ? Retrieved from investopedia/ask/answers/042115/what-difference- between-net-income-and-cash-flow-operating-activities
FreshBooks. (n.). What Are Investing Activities? How to Report Investment Activities on the Cash Flow Statement. Retrieved from freshbooks/hub/accounting/investing-activities
Technology Desk. (October 12, 2020). Apple’s 5G IPhone Set to Launch. Retrieved from theglobalherald/technology/apples-5g-iphone-set-to-launch/
Week 7 BUS 1102 Written Assignment
Course: Basic Accounting (Bus 1102)
University: University of the People
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