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1Challenges in the Business EnvironmentTatiana DunklinBusiness and Society 475Challenges in the Business Environment Assignment 2Instructor: Daniel GoldsmithJune 6, 2016
2Challenges in the Business EnvironmentResearching a company’s business environment will provide large amounts of data that could be used by investors, consumers, and even competitors. A company’s business environment consistsof many things; this essay will review the three most important business environment factors; income statement, balance sheets, and cash flow. This essay will also compare Apple’s financial health of top competitors in the Information Technology industry; Hewlett Packard and Microsoft. These factors are important and provide valuable information about a company concerning its general financial health. Although financial statements are important, a company’stechnological advantages, globalization, and benchmarking are also important. These topics also will be discussed in more detail throughout this essay. First, the Income statement of Apple Inc., HP, and Microsoft. Income Statement What can be said about income statement, otherwise known as a profit and loss statement, is a summary of a company’s profit or loss during any one given period of time, such as a month, three months, or one year” (BusinessTown.com, 2003). Apple’s income statement proves its profits continue to set records in the IT industry. According to Forbes.com statistics, Apple’s totalrevenues as of March 2012 equaled more than one hundred eight Billion with a total net income of more than twenty-five Billion, nearly doubling last year’s earnings. Apple is holding its own, next to its competitors with HP’s total revenue for the same period reaching more than $one hundred twenty Billion, with the total net income of more than seven billion, which was down from the previous year. As for Microsoft, its total revenue for the same period was more than sixty-nine Billion, with the total net income of more than twenty-three Billion, slightly up from last year. As company’s become more profitable, the cost of their shares increased.
3Challenges in the Business EnvironmentBalance Sheet Unlike the Income Statement, the balance sheet shows the company’s financial condition for a certain date instead of a certain moment. According to Accounting Coach, the balance sheet offers a company's financial position at the end of a specified date. Some describe the balance sheet as a snapshot of the company's financial position at a point a moment or an instant period in time. According to Forbes.com statistics, as of December 2012. Apple’s current total assets equaled more than fifty million with total liabilities and stock equity. Although Microsoft beat out Apple in total assets, Apple beat its competitors in stock equity. However, the next document one shall review is the Statement of cash flow; it is the last document in set of financial records reviewed as part of a company’s financial health.