Obtain the annual reports (or annual report data) of five well-known companies. You can get the reports either from the companies’ Web sites, from your college library, or by mailing a request directly to the company (allow two weeks for delivery). Or you can go online and search the SEC EDGAR database (http://www.sec.gov/edgar .shtml), which includes the financial reports of most well-known companies.
Requirements
1. After selecting five companies, examine their income statements to search for the following items:
a. Net income or net loss
b. Earnings per share data
2. Study the companies’ balance sheets to answer the following questions:
a. What classes of stock has each company issued?
b. Which item carries a larger balance—the Common Stock account or Paid-In Capital in Excess of Par (also labeled Additional Paid-In Capital)?
c. What percentage of each company’s total stockholders’ equity is made up of retained earnings?
d. Do any of the companies have treasury stock? If so, how many shares and how much is the cost?
3. Examine each company’s statement of stockholders’ equity for evidence of the following: a. Cash dividends b. Stock dividends c. Treasury stock purchases and sales
4. As directed by your instructor, either write a report or present your findings to your class. You may not be able to understand everything you find, but neither can the Wall Street analysts! You will be amazed at how much you have learned.