Introduction
Best Buy Co., Inc. is a publically traded company on the New York Stock Exchange, represented by their stock symbol: BBY.N. As a publically traded company, Best Buy is required to prepare and file an annual 10K report. It is important to note that some information may be biased toward Best Buy because their management files the financial reports. For this reason, it is crucial to analyze the given information thoroughly and completely. The information was analyzed to provide results that are most important to consider in investing decisions.
Revenues
Best Buy recognizes revenue from six categories: consumer electronics, computing and mobile phones, entertainment, appliances, services and other. Their revenue arises primarily …show more content…
Asset Identification
Best Buy records merchandise inventory at the lower-of-cost-or-market. Freight-related costs from their vendors are included as part of the net cost of merchandise inventories. Other costs associated with acquiring, storing and transporting merchandise inventories to their retail stores are expensed as incurred and included in the cost of goods sold (Merchandise Inventories, 62). The inventory estimate adjusts for projected physical inventory losses. Physical inventory is taken periodically to ensure the inventory reported is accurately represented on the balance sheet. The inventory reflects markdowns for the cost over the amount they expect to realize from the ultimate sale or other disposal. Markdowns create a new cost basis for the inventory. Additional changes in fact or circumstances do not result in the setback of previously recorded markdowns or an increase in the new cost basis for the inventory (Merchandise Inventory, 62). …show more content…
However, there are exceptional cases where inventory could be reported above cost. Inventory with previous fixed monetary value, with no substantial cost of marketing, may be stated at such monetary values. Other expectations must be justifiable by a company’s inability to determine appropriate approximate costs, immediate marketability at quoted market price, and the characteristic of unit interchangeability (FASB ASC 330-10-35-15).
Net Earnings and Comprehensive Income
Net earnings and comprehensive income are composed of different components. Comprehensive income is a change in equity of an entity during a period from transactions and other events and circumstances from non-owner sources (Kieso et al., 53). However, net earnings are calculated with the sum all of revenues minus all the expenses incurred. Net earnings are the financial gain or loss a business made in a period, whereas comprehensive income is the change in equity in the same period originating from non-owner sources.
Comprehensive Income Elements
Best Buy’s comprehensive income is computed as net earning plus other items that are recorded directly to stockholder 's equity. The significant components of comprehensive income are foreign currency translation adjustments and unrealized gains and losses, net of tax, on available-for-sale marketable equity securities (Comprehensive Income (Loss),
Best Buy Co., Inc. is a publically traded company on the New York Stock Exchange, represented by their stock symbol: BBY.N. As a publically traded company, Best Buy is required to prepare and file an annual 10K report. It is important to note that some information may be biased toward Best Buy because their management files the financial reports. For this reason, it is crucial to analyze the given information thoroughly and completely. The information was analyzed to provide results that are most important to consider in investing decisions.
Revenues
Best Buy recognizes revenue from six categories: consumer electronics, computing and mobile phones, entertainment, appliances, services and other. Their revenue arises primarily …show more content…
Asset Identification
Best Buy records merchandise inventory at the lower-of-cost-or-market. Freight-related costs from their vendors are included as part of the net cost of merchandise inventories. Other costs associated with acquiring, storing and transporting merchandise inventories to their retail stores are expensed as incurred and included in the cost of goods sold (Merchandise Inventories, 62). The inventory estimate adjusts for projected physical inventory losses. Physical inventory is taken periodically to ensure the inventory reported is accurately represented on the balance sheet. The inventory reflects markdowns for the cost over the amount they expect to realize from the ultimate sale or other disposal. Markdowns create a new cost basis for the inventory. Additional changes in fact or circumstances do not result in the setback of previously recorded markdowns or an increase in the new cost basis for the inventory (Merchandise Inventory, 62). …show more content…
However, there are exceptional cases where inventory could be reported above cost. Inventory with previous fixed monetary value, with no substantial cost of marketing, may be stated at such monetary values. Other expectations must be justifiable by a company’s inability to determine appropriate approximate costs, immediate marketability at quoted market price, and the characteristic of unit interchangeability (FASB ASC 330-10-35-15).
Net Earnings and Comprehensive Income
Net earnings and comprehensive income are composed of different components. Comprehensive income is a change in equity of an entity during a period from transactions and other events and circumstances from non-owner sources (Kieso et al., 53). However, net earnings are calculated with the sum all of revenues minus all the expenses incurred. Net earnings are the financial gain or loss a business made in a period, whereas comprehensive income is the change in equity in the same period originating from non-owner sources.
Comprehensive Income Elements
Best Buy’s comprehensive income is computed as net earning plus other items that are recorded directly to stockholder 's equity. The significant components of comprehensive income are foreign currency translation adjustments and unrealized gains and losses, net of tax, on available-for-sale marketable equity securities (Comprehensive Income (Loss),