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Bus 1102 Written Ssignment Unit 7

This document provides a written assignment analyzing Apple Inc.'s cash flows. It discusses key items from Apple's Statement of Cash Flows, including net income and repurchase of common stock. While the author initially did not expect to see repurchase of common stock listed under financing activities, they learned this makes sense as it reduces shares and allows earnings, revenue, and cash flow to grow faster. The document also notes Apple had a net positive cash inflow of $24,311 million, indicating a healthy and growing business, and that investing in Apple provides growth potential without significant risk.

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473 views3 pages

Bus 1102 Written Ssignment Unit 7

This document provides a written assignment analyzing Apple Inc.'s cash flows. It discusses key items from Apple's Statement of Cash Flows, including net income and repurchase of common stock. While the author initially did not expect to see repurchase of common stock listed under financing activities, they learned this makes sense as it reduces shares and allows earnings, revenue, and cash flow to grow faster. The document also notes Apple had a net positive cash inflow of $24,311 million, indicating a healthy and growing business, and that investing in Apple provides growth potential without significant risk.

Uploaded by

Mailu Shirl
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

University Of the People

Basic Accounting Bus 1102

Written Assignment Unit 7

Michael Marslek

10/18/21
Introduction
For this week's written assignment, I chose to write about Apple Inc. because it is a well-known
corporation that sells its products all over the world and is very successful. Apple became the first
publicly traded U.S. corporation to be valued at more than $1 trillion in August 2018, and just two years
later, in August 2020, it became the first US corporation to be valued at more than $2 trillion.
(Technology Desk, 2020).
This company's ticker symbol is AAPL. The link provided will take you to its K-10 version:
https://www.sec.gov/ix?doc=/Archives/edgar/data/320193/000032019319000119/a10-k20199282019.htm
The Net income value was what I expected to see in the reported Statement of Cash Flows. Net
income is the first item on the cash flow statement, and it is carried over from the income statement.
(Murphy, 2020). Indeed, one of the primary reasons for examining cash inflows and outflows is to
compare cash from operations to Net Income, therefore it is not surprising that we can find this
information in such a document.
The Repurchase of common stock in the Financing Activities category was something I didn't
expect to see. This value, I believe, should be displayed in the Investment Activities category; “investing
activities in accounting refer to the purchase and sale of long-term assets as well as other business
investments” (FreshBooks, n.d.). However, I've learned that a repurchase of common stock is the act of
purchasing your own shares from the market, and that financing activities are concerned with raising
capital for the company and returning it to investors. This value was written, because "reducing the
number of shares means EPS, revenue, and cash flow grow more quickly" (Banton, 2020).
Even without checking the Statement of Cash Flows, I believe that investing in Apple Inc. is a
good idea. This company is greatly successful, and it is becoming even more so with each passing year.
However, let us examine the documents. This company's net positive cash inflow is $24,311 million. This
company not only generates large cash inflows (indicating that the business is very healthy), but it also
invests and raises funds through the issuance of common stock. Apple Inc. has tremendous growth
potential, and I believe that investing in this company is an excellent way to increase your wealth without
taking on significant risk.
Everyone is aware that the previous pandemic year was extremely difficult for all businesses.
Apple had some issues and even closed some of their stores, but thanks to proper management and
different ways of generating profits, they are still extremely successful and, as I mentioned above, became
the first $2 trillion U.S company.
Word Count 511
References:
Caroline Banton. (September 23, 2020). Share Repurchase. Retrieved from
https://www.investopedia.com/terms/s/sharerepurchase.asp
Chris Murphy. (April 23, 2020). How Do Net Income and Operating Cash Flow Differ? Retrieved from
https://www.investopedia.com/ask/answers/042115/what-difference-between-net-income-and-cash-flow-
operating-activities.asp
FreshBooks. (n.d.). What Are Investing Activities? How to Report Investment Activities on Cash Flow
Statement. Retrieved from https://www.freshbooks.com/hub/accounting/investing-activities
Technology Desk. (October 12, 2020). Apple’s 5G IPhone Set to Launch. Retrieved from
https://theglobalherald.com/technology/apples-5g-iphone-set-to-launch

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