Calculate the expenses to determine what will change

Assignment Help Financial Accounting

Reference no: EM133560943

Question: Review the current financial statements of Starbucks through Yahoo! Finance Links to an external site. or the EDGAR | Company Filings Links to an external site. database in the Filings and Forms page. You can access the financial statements by going to the Yahoo! Finance webpage, typing in the stock symbol of Starbucks, and then clicking on the "Financials" tab

Reviewing the previous quarter's financial statements will provide you with data to construct pro forma financial statements for Starbucks and make some basic projections. Constructing two pro forma financial statements and addressing some questions about your projections. The two financial statements will include an Income Statement and a Balance Sheet.

Part 1

Use the EDGAR | Company Filings Links to an external site. or Yahoo! Finance Links to an external site. database to download the last 10-Q from Starbucks into Excel. Use the downloaded data to complete the Income Statement and Balance Sheet. Assume the following:

Sales will increase for the next quarter by the same percentage increase from the previous quarter to the last reported quarter. For example, if sales increased 8% from the last quarter to the current reported quarter, you would use 8% as the sales increase for your pro formas.
Calculate the expenses to determine what will change and what will remain the same.

Note: Not all costs are associated with the cost of sales. It will be up to you to determine which line items must be increased and which must be left alone. This will require you to distinguish between fixed and variable costs

Within each line item expense, explain your rationale and provide a brief summary.

Part 2

Then, calculate a quarterly variance analysis using the Variance Analysis Complete the following in your variance analysis:

In the Excel template, insert the line items.
In Column C, (Q4, 20NN) enter the previous quarter's numbers as the budget.
In Column D, (Q1, 20NN) enter the current quarter's actual numbers.
In Column E, the spreadsheet will calculate the dollar difference between the budget and actual numbers.
In Column F, the spreadsheet will calculate the percentage change.
In Column G, analyze and speculate the rationale for the variances.

Reference no: EM133560943

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