Analyzing an Income Statement
ACC/230
September 26, 2013
Analyzing an Income Statement
During my analysis of Eastman Kodak’s income statement from 2003 to 2004, several indicators were observed that would reveal the potential financial position of the company. In order for a business to be successful, it should see a continuous increase in profits, assets, and stockholder’s equity and a decrease in liabilities, or monies owed. The future of Eastman Kodak is questionable based on the information found on their financial statements.
Eastman Kodak suffered a decline in total assets from 2003 to 2004. Kodak saw a $5,000 increase in cash and cash equivalents between 2003 and 2004. They also experienced an increase in net receivables of $217 million, $80 million in net inventories, and $97,000 in good will assets. Despite all of these increases, Kodak had a $40 million decrease in deferred taxes, $24 million decrease in other current assets, $42 million decrease in discontinued operations, and $539,000 decrease in property, plant assets, and equipment. All together, Kodak’s total assets declined a total of $109,000 from 2003 to 2004.
Kodak reduced their long-term debt by $450,000. They also decreased their pension and postretirement liabilities by $36,000. These figures bring the total liabilities from $11,601,000 in 2003 to $10,926,000 in 2004 equaling a decrease of $675,000. I found no change in common stocks; however, there was a $3,000 increase in unearned restricted stocks and an $8,000 decrease in treasury stocks at cost. There was also a $148,000 increase in accumulated other comprehensive loss. In total, Kodak experienced an increase of $566,000 in stockholder’s equity and $407,000 increase in retained earnings.
REFERENCES
http://www.kodak.com/US/en/corp/annualReport04/financials_48.shtml
Fraser, L. M., & Ormiston, A. (2007). Understanding financial statements (8th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall.