Balance Sheet For Microsoft Corporation Accounting Essay

A Pages:3 Words:1634
This is just a sample.
To get a unique essay
Hire Writer
Download: .pdf, .docx, .epub, .txt
University/College: University of Arkansas System
Type of paper: Essay

A limited time offer!

Get custom essay sample written according to your requirements

Urgent 3h delivery guaranteed

Hire Writer

Microsoft is the most outstanding engineering corporation in the universe that deals with computing machines, ” With one-year grosss of more than $ 32 billion, Microsoft Corporation is more than the largest package company in the universe: it is a cultural phenomenon. The company ‘s nucleus concern is based on developing, fabrication, and licencing package merchandises, including runing systems, waiter applications, concern and consumer applications, and package development tools, every bit good as Internet package, engineerings, and services ” . ( http: //www.

We will write a custom essay sample on Balance Sheet For Microsoft Corporation Accounting Essay specifically for you
for only $13.90/page
Order Now

fundinguniverse.com/company-histories/Microsoft-Corporation-Company-History.html ) hypertext transfer protocol: //www.referenceforbusiness.com/history2/14/Microsoft-Corporation.htmlA A A A

hypertext transfer protocol: //www.redciencia.cu/empres/Intempres2000/Sitio/Principal/Conferencias/CUBA_Inteligencia % 20Empresarial/victor/bcrc6.htm

”The name of the celebrated individual – Bill Gates comes in one ‘s head with reference of the name of Microsoft. He is the laminitis of the company and is believed to be the smartest coders of all time. ” ( hypertext transfer protocol: //www.bighistory.net/microsoft-a-short-history/ ) . Led by him, Microsoft had witnessed its flowers and has been able to hold its merchandise on about every personal computing machine in the universe, and in the procedure making criterions in the engineering industry every bit good as market re-definition.

”Gates was foremost exposed to computing machines at school in the late 60 ‘s with his friend Paul Allen. At 14 ; Gates and he ‘s friend were composing and proving computing machine plans. In 1972 they established their first company, Traf-O-Data, which sold a fundamental computing machine that, recorded and analyzed traffic informations. He ‘s friend went on to analyze computing machine scientific discipline at the University of Washington and so dropped out to work at Honeywell, while Gates enrolled at Harvard. In 1975, Gates and Allen wrote a version of BASIC for the new Altair personal computer kit merely released by MITS Computer. Later that twelvemonth Gates left college to work full clip developing programming linguistic communications for the Altair, and he and Allen relocated to Albuquerque, New Mexico, to be close MITS Computer, where Allen took a place as manager of package development. Gates and Allen named their partnership Micro-soft ” . ( http: //www.fundinguniverse.com/company-histories/Microsoft-Corporation-Company-History.html ) .

The word Microsoft was developed from two different words, micro from personal computer and soft from package. The name was registered in New Mexico in November 1976. On November 1978, the first international office of Microsoft was established in Japan and its name was ASCII ( American Standard Code for Information Interchange ) . It is now known as Microsoft Japan. In January 1979 the company ‘s central office was moved to Bellevue Washington. ( http: //www.bighistory.net/microsoft-a-short-history/ ) . In the early 80 ‘s, Microsoft witnessed a period of great success when IBM contracted the company to develop an operating system for its personal computing machines ( Personal computer ) , which was underway. In the late 80 ‘s Microsoft issued IPOs ( initial public offering ) of over two million portions and in the infinite of one twelvemonth the monetary value or the portions tripled and in the procedure doing Gates a billionaire at about 30 old ages of age.

Harmonizing to Richard B, McKenzie ( 2000 ) ”Microsoft bases accused of seeking to widen its market laterality by bear downing the lowest of all monetary values for its browser Internet Explorer ” . Nonetheless ; the company had tonss of other critics and legal instances against it from rivals and the likes. Microsoft success was further heightened by the tech bubble of the 2000 following the release of the Windowss XP, windows 2000, the acquisition of Visio corporation which stood as the largest acquisition in the life of Microsoft so far with dealing value of about One and half a billion dollars. The company besides spread its tentacles into the universe of bet oning with their popularly known X-BOX which has remained a success boulder clay day of the month. ( http: //www.fundinguniverse.com/company-histories/Microsoft-Corporation-Company-History.html ) .

DESCRIPTION AND ANALYSIS OF MICROSOFT PERFORMANCE OVERTIME

Cardinal Dates:

1975: Microsoft is founded by Bill Gates and Paul Allen ; they sell BASIC, the first Personal computer computing machine linguistic communication plan to MITS Computer, Microsoft ‘s first client.

1981: Microsoft, Inc. is incorporated ; IBM uses Microsoft ‘s 16-bit operating system for its first personal computing machine.

1982: Microsoft, U.K. , Ltd. is incorporated.

1983: Paul Allen resigns as executive vice-president but remains on the board ; Jon Shirley is made president of Microsoft ( he subsequently becomes CEO ) ; Microsoft introduces the Microsoft Mouse and Word for MS-DOS 1.00.

1985: Microsoft and IBM forge a joint development understanding.

1986: Microsoft stock goes public at $ 21 per portion.

1987: The Company ‘s first CD-ROM application, Microsoft Bookshelf, is released.

1990: Jon Shirley retires as president and CEO ; Michael R. Hallman is promoted in Shirley ‘s topographic point ; the company becomes the first Personal computer package house to excel $ 1 billion of gross revenues in a individual twelvemonth.

1992: Bill Gates is awarded the National Medal of Technology for Technological Achievement.

1993: The Company introduces Windows NT.

1995: Bill Gates publishes his first book, The Road Ahead.

1996: The Company acquires Vermeer Technologies and its package application, FrontPage.

1997: The Justice Department alleges that Microsoft violated a 1994 consent edict refering licencing the Windows runing system to computing machine makers.

1998: The U.S. Department of Justice files two antimonopoly instances against Microsoft, avering the company had violated the Sherman Act.

2000: The Company acquires Visio Corporation, its largest acquisition to day of the month.

2001: Microsoft Windows XP is released internationally.

2003: Microsoft launches Windows Server 2003.

2007: Microsoft launches Windows view

2009: Microsoft launches windows 7

Beginning: hypertext transfer protocol: //www.fundinguniverse.com/company-histories/Microsoft-Corporation-Company-History.html

Balance sheet for Microsoft Corporation as at 30th June 2010. ( Annually )

Assetss [ + ]

in Millions of Dollars

06/2010

06/2009

06/2008

06/2007

06/2006

Cash and Equivalents

5,505

6,076

10,339

6,111

6,714

Restrictable Cash

Marketable Securities

31,283

25,371

13,323

17,300

27,447

Histories Receivable

13,014

11,192

13,589

11,338

9,316

Loans Receivable

Other Receivables

Receivabless

13,014

11,192

13,589

11,338

9,316

Inventories, Raw Materials

172

170

417

435

465

Inventories, Work in Progress

16

45

31

148

Inventories, Purchased Components

Inventories, Finished Goods

552

502

537

544

1,013

Inventories, Other

Inventories, Adjustments & A ; Allowances

Inventories

740

717

985

1,127

1,478

Prepaid Expenses

Current Deferred Income Taxes

2,184

2,213

2,017

1,899

1,940

Other Current Assetss

2,950

3,711

2,989

2,393

2,115

Entire Current Assets

55,676

49,280

43,242

40,168

49,010

Land and Improvements

526

526

518

428

362

Buildings and Improvement

8,187

7,824

6,030

4,247

3,146

Machinery, Furniture and Equipment

7,546

6,732

5,996

4,691

3,715

Construction in Advancement

Fixed Assets, Other

Fixed Assets, Entire

16,259

15,082

12,544

9,366

7,223

Gross Fixed Assetss

16,259

15,082

12,544

9,366

7,223

Accumulated Depreciation

( 8,629 )

( 7,547 )

( 6,302 )

( 5,016 )

( 4,179 )

Net Fixed Assetss

7,630

7,535

6,242

4,350

3,044

Intangibles

1,158

1,759

1,973

878

539

Cost in Excess

12,394

12,503

12,108

4,760

3,866

Non-Current Deferred Income Taxes

279

949

1,389

2,611

Other Non-Current Assetss

9,255

6,532

8,279

11,626

10,527

Entire Non-Current Assetss

30,437

28,608

29,551

23,003

20,587

Entire Assetss

86,113

77,888

72,793

63,171

69,597

Liabilitiess [ + ]

in Millions of Dollars

06/2010

06/2009

06/2008

06/2007

06/2006

Histories Collectible

4,207

5,008

4,034

3,247

2,909

Short Term Debt

1,000

2,000

Notes Collectible

Accrued Expenses

Accrued Liabilitiess

3,283

3,156

2,934

2,325

1,938

Deferred Grosss

13,652

13,003

13,397

10,779

9,138

Current Deferred Income Taxes

1,557

Other Current Liabilitiess

4,005

3,867

9,521

7,403

6,900

Entire Current Liabilitiess

26,147

27,034

29,886

23,754

22,442

Long Term Debt

4,939

3,746

Deferred Income Tax

229

Other Non-Current Liabilitiess

8,623

7,550

6,621

8,320

7,051

Minority Interest

Capital Lease Obligations

Preferred Securities of Subsidiary Trust

Preferred Equity Outside Shareholders ‘ Equity

Entire Non-Current Liabilitiess

13,791

11,296

6,621

8,320

7,051

Entire Liabilitiess

39,938

38,330

36,507

32,074

29,493

Preferred Shareholder ‘s Equity

Common Shareholder ‘s Equity

46,175

39,558

36,286

31,097

40,104

Common Par

62,856

62,382

62,849

Additional Paid in Capital

60,557

59,005

Accumulative Translation Adjustments

149

Retained Net incomes

( 16,681 )

( 22,824 )

( 26,563 )

( 31,114 )

( 20,130 )

Treasury Stock

Other Equity Adjustments

1,505

1,229

Entire Capitalization

51,114

43,304

36,286

31,097

40,104

Entire Equity

46,175

39,558

36,286

31,097

40,104

Entire Liabilities & A ; Shareholder ‘s Equity

86,113

77,888

72,793

63,171

69

Closing monetary value = $ 25.51

Volume sold =25.16m

Beginning: hypertext transfer protocol: //www.answers.com/main/dsdata? dsid=2940 & A ; templateid=0 & A ; cid=27590212 & A ; qm_page=30703. [ Accessed, 4 April 2011 ] .

The balance sheet above gives a brief sum-up of the plus and liabilities of Microsoft at a glimpse, it is evident that Microsoft has been able to keep plus at a greater proportion than liabilities overtime. The company has a good mix of debt and equity, for every $ 1 owned it is borrowing less than 90 cents. This shows that the company is non excessively leveraged and less hazardous while besides basking some degree of revenue enhancement shield from the purchase. Microsoft has a good opportunity of go oning into a traveling concern in the nearest foreseeable hereafter because its capital construction shows more of a residuary ownership.

With more descriptive statistics, we can besides analyze the public presentation of Microsoft on a monthly footing from the twelvemonth 1988- 2009 utilizing returns ( unit % )

See excel for descriptive statistics.

Microsoft return ( unit % )

Market return ( unit % )

Mean

0.021622876

Mean

0.857870722

Standard Error

0.00618845

Standard Error

0.269942879

Median

0.022084196

Median

1.41

Manner

0.064221396

Manner

1.78

Standard Deviation

0.100359793

Standard Deviation

4.377737838

Sample Variance

0.010072088

Sample Variance

19.16458858

Kurtosis

1.421423202

Kurtosis

1.709578314

Lopsidedness

0.366537791

Lopsidedness

-0.812673531

Scope

0.751310392

Scope

29.51

Minimum

-0.343529412

Minimum

-18.46

Maximum

0.40778098

Maximum

11.05

Sum

5.686816298

Sum

225.62

Count

263

Count

263

From the descriptive statistics above, Microsoft has a positive lopsidedness unlike the market whose lopsidedness is negative, this indicates that Microsoft has a better flow or return than the market.

It could besides be noted that Microsoft is ( 1 ) criterion divergence off from its average whereas the market is ( 4 ) criterion divergence off from its mean, this means that the returns of Microsoft had non been excessively volatile over the old ages and return on stocks are less hazardous.

COMPARISON OF MOCROSOFT PERFORMANCE WITH S & A ; P 500 ( MARKET ) USING T-TEST

See t-test on Excel

H0: Microsoft did non surpass the market

H1: Microsoft outperformed the market

t-Test: Paired Two Sample for Means

A

Variable 1

Variable 2

Mean

0.021622876

0.857870722

Discrepancy

0.010072088

19.16458858

Observations

263

263

Pearson Correlation

0.539530773

Hypothesized Average Difference

0

df

262

T Stat

-3.136067434

P ( T & lt ; =t ) one-tail

0.000953757

t Critical one-tail

1.650690284

P ( T & lt ; =t ) two-tail

0.001907515

t Critical two-tail

1.969059657

A

Decision: From the t-Test above, since the t-stats is greater in value than the t -critical ( irrespective of the -ve mark ) , we need to accept the alternate hypothesis ( H1 ) which says that Microsoft outperformed the market and reject the Null hypothesis ( H0 ) which says that Microsoft did non surpass the market.

We can besides deduce this decision by looking at the P- value, here we can see that the p- value is less than the significance degree of.05, therefore we need to accept the alternate hypothesis ( H1 ) .

Analysis OF MICROSOFT PERFORMANCE WITH CAPM

Arrested development Statisticss

Multiple R

0.258985259

R Square

0.067073365

Adjusted R Square

0.063498933

Standard Error

0.185690508

Observations

263

Analysis of variance

A

df

United states secret service

Multiple sclerosis

F

Significance F

Arrested development

1

0.647027164

0.647027164

18.764764

2.11102E-05

Residual

261

8.999531777

0.034480965

Entire

262

9.646558942

A

A

A

A

Coefficients

Standard Error

T Stat

P-value

Lower 95 %

Upper 95 %

Lower 95.0 %

Upper 95.0 %

Intercept

-0.32415329

0.011530623

-28.1123831

6.17385E-81

-0.346858177

-0.30145

-0.34686

-0.30145

X Variable 1

0.011371441

0.002625088

4.331831484

2.11102E-05

0.006202393

0.01654

0.006202

0.01654

CAPM: – Tocopherol ( R ) =RF+I? [ RM-RF ]

By replacing the CAPM expression into the arrested development, we have Y= I±+I?x+e

Y = dependant variable

I± = intercept

I? = co-efficient of independent variable

vitamin E =error

When x=0, I± is an estimation of Y, so extra return of Microsoft would be given as: Excess return= -0.32415329+0.011371441+0.185690508

Adjusted R Square = 0.063498933

The adjusted R Square indicates that 6.3 % of the variableness in the extra return of Microsoft is explained by the market. I.e. for every per centum alteration of return in the market, Microsoft ‘s return alterations by 6.3 % .

Decision

Microsoft