Essay on Balance Sheet and Income Statement Commentary

1508 Words Jun 17th, 2012 7 Pages
Balance Sheet and Income Statement Commentary
Belinda Greer
March 24, 2012
Murali Ramachandran

Balance Sheet and Income Statement Commentary
Balance sheets and income statements are a snapshot of a company’s stability and financial situation. Combined the statements show the income, expenses, and stockholder’s equity in the company. These statements are often analyzed by financial institutions when a company comes to them needing a loan. Stockholders and other investors also look at these statements to make sure their investment will return a profit for them. This paper will look at four different companies and their balance sheets and income statements. The companies are Eastman Chemical Company, Covenant Transportation
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The company showed a large decrease of 233.78% in preferred stock, dropping from $3,289,000 to -$14,267,000 (Yahoo Finance, 2012). From reviewing the balance sheet and income statement, Covenant is struggling to keep the trucks on the road and is prey to the economy and rising costs
The Cheesecake Factory, Inc. is an upscale full-service dining restaurant in the United States. In 2012 the company has 170 dining restaurants. They also own and operates their own bakery production facility located in California and North Carolina. The Cheesecake Factory, Inc. produces baked desserts as well as other products for the restaurants. They also wholesale their products to other foodservice operators. The company was founded in 1972, and the headquarters are in Calabasas Hills, California (Yahoo Finance, 2012). The Cheesecake Factory, Inc’s balance sheet and income statement is a comparison of the years 2011 and 2010, and shows the company as another struggling company. The company’s total current assets decreased by 9.52% and include cash, short-term investment as well as inventory. The company had an increase of 7.83% in their total liabilities which was due to increases in their accounts payable. The net tangible assets for The Cheesecake Factory, Inc. showed a decrease of 8.61% over the twelve month period. The income statement showed an increase of 5.02% in the company’s gross profit during 2011. It also showed operating income or

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