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Working Captial Paper. Working Capital and Financial Environment Paper For
every company that exists that offers a service or product ...
... Throughout the paper are significant examples that display the ... Committee Chairman,
President, and CEO, Harwinton Captial Board of ... 7. Sales to working capital. ...
... understand what exactly they are working for and ... such as bonds and commercial paper,
or to ... 16.16% -20.45% Total Stockholder's Equity (Captial Deficiency) 36.48 ...
Submitted by mattmacwllms on February 16, 2008
Category: Miscellaneous
Words: 1370 | Pages: 6
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Working Capital and Financial Environment Paper
For every company that exists that offers a service or product to the public there is a focus on accurately measuring its current assets and liabilities in the most honest financial regulated environment possible. Brealey states that one of the most “useful summary measure[s] of current assets or liabilities” is net working capital (or just working capital). This paper will give an overview of the working capital elements for both Apple Inc. and the Microsoft Corporation for the 2006 fiscal year. Additionally, it will discuss the financial environment of both companies as it relates to regulatory bodies, the importance of control programs, effective internal control techniques, and the impact of the 2002 Sarbanes-Oxley Act.
Elements of Working Capital
The working capital of a company can be better termed as the short term financial state that a company is in. Working capital is described as the current assets and current liabilities of a company and the optimal state is to have current assets that are higher than its current liabilities. When this is not the case the company could be in jeopardy when it comes to paying its short-term debts to its creditors. Apple Inc and the Microsoft Corporation both manufacture similar products that and therefore have assets and liabilities on their respective balance sheets that are very similar. When looking at their balance sheets there are assets such as cash, short-term investments, inventories, and accounts receivable. Their liabilities include accounts such as accounts payable, accrued compensation, income taxes, and short / current long-term debt. The current assets for Apple in fiscal year 2006 are $14.5 million while Apple’s current liabilities for 2006 were $6.4 million (Apple 2006 Annual Report). Applying the standard working capital formula of total current assets minus the total...
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