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Unformatted text preview: c. What are the differences between the cash and accrual bases of accounting? How much did Apple report for net income for fiscal 2008? How much cash did Apple generate from operations for fiscal 2008? Identify the largest item that accounts for the difference between net income and cash generated from operations. (10 points) II. Ratio analysis: a. Compute the following profitability ratios for the three years 20062008 (40 points): Percentage change in Net sales: from 2006 to 2007, and 2007 to 2008 Percentage change in Operating income: from 2006 to 2007, and 2007 to 2008 Gross profit rate = Gross margin Net sales Profit margin ratio = Net income Net sales b. Comment on the trends in each of the foregoing measures of Apples profitability. (20 points) c. What is Apples expectation for its gross profit ratio (gross margin percentage) in 2009? Cite the specific expected approximate amount and recite the reason for it given by Apple. (5 points)....
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 Winter '07
 Loster

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