Question 3Q=50,000 - (25 P)FC=2,750,000VC=200unitTC=FC+VCTVC=VC.docx

Question 3Q=50,000 - (25 *
P)FC=2,750,000VC=200/unitTC=FC+VCTVC=VC/unit * # of
Units ProducedTC=$2,750,000 + 200QQ=50,000 - (25 *
P)25P=50,000-QP=(50,000/25) - (1Q/25)P=2000 - 0.04QTR=P *
QTR=(2000 - 0.04Q) * QTR=2000Q-0.04Q2MR=dTR=2000 -
0.08QdQMC=dTC=200dQMR = MC at profit maximizing
levelQ2000 - 0.08Q = 200Q0.08Q = 2000 - 200Q0.08Q =
1800Q1800/0.08 = 25,500Q=25,500P=2000 - 0.04QP=2000 -
0.04 (22,500)P=2000 - 900P=$1,100AC=TC/QTC=$2,750,000 +
200 (22,500)TC=$2,750,000 +
4,500,000TC=7,250,000AC=MCAC=$200Profit=TR - TCTR=P
* QTR=$1,100 * 22,500TR=24,750,000.00Profit=24,750,000 -
7,250,000Profit=17,500,000====
Question 4Impacts of the ransactions on the major financial
statementsStatement of cash flowsCash flows from operating
activitiesRevenuesDiscount on goods$ (800,000.00)Total
operating cash inflowsCash flows from investing
activitiesIncrease in the value ofProperty, Plant, and
Equipment$ 2,100,000.00Net flow from other non operating
activitiesDecrease in accounts receivable$ (1,500,000.00)Total
cash flows $ (200,000.00)Income statementRevenues$
(800,000.00)ExpensesBad debt expense$ 1,500,000.00Gross
profit$ (2,300,000.00)Add: Income from non-operating
activities$ 2,100,000.00Net income$ (200,000.00)Balance
sheetsCurrent assetsLiabilities and stockholders equityCash$
2,100,000.00Dividends & retained earnings$ 2,100,000.00$
(800,000.00)Less:$ (1,500,000.00)Net change in cash$
1,300,000.00$ (800,000.00)Accounts receivable$
(1,500,000.00)Change in the Total assets$ (200,000.00)Change
in stockholders equity$ (200,000.00)A write-off of an
Accounts Receivable amount of $1.5 millionThis reduces the
accounts receivable in the balance sheet by $1.5 million.In the
income statement, the operating expense (bad debts expense
increases by $1.5 million) thus decreasing the net income by the

same amount.In the statement of cash flows, the change in the
accounts receivable decreases by $1. millionProperty, Plant, and
Equipment asset valued at $5 million for cash, which generated
a profit of $2.1 million.Cash flow from the sale of property,
plant and equipmet increases in the statement of cash flows by
$2.1 millionIncome from non operating activities increases by
$2.1 million Cash in the balance sheet will increase by $2.1
millionIPS gave a 10% discount to a customerThe revenues in
the income statement will decrease by $0.8 millionCash in the
balance sheet statement will decrease by $0.8 millionIn the
statement of cash flows, the net income will decrease by $0.8
million
AMD Income StatementConsolidated Statements of Operations -
USD ($) shares in Millions, $ in Millions12 Months EndedDec.
31, 2016Dec. 26, 2015Dec. 27, 2014Income Statement
[Abstract]Net revenue$4,272$3,991$5,506Cost of
sales3,2742,9113,667Gross margin9981,0801,839Research and
development1,0089471,072Marketing, general and
administrative460482604Amortization of acquired intangible
assets0314Restructuring and other special charges, net-
1012971Licensing gain-8800Goodwill impairment
charge00233Operating loss-372-481-155Interest expense-156-
160-177Other income (expense), net80-5-66Loss before equity
loss and income taxes-448-646-398Provision for income
taxes39145Equity in income (loss) of ATMP JV-1000Net
loss($497)($660)($403)Net loss per shareBasic (USD per
share)($0.60)($0.84)($0.53)Diluted (USD per
share)($0.60)($0.84)($0.53)Shares used in per share
calculationBasic (shares)835783768Diluted (shares)835783768
AMD Balance SheetConsolidated Balance Sheets - USD ($) $ in
MillionsDec. 31, 2016Dec. 26, 2015Current assets:Cash and
cash equivalents$1,264$785Accounts receivable,
net311533Inventories, net751678Prepayment and other -
GLOBALFOUNDRIES3233Prepaid expenses6343Other current
assets[1]109248Total current assets2,5302,320Property, plant
and equipment, net164188Goodwill289278Investment in ATMP

JV590Other assets[1],[2]279298Total assets3,3213,084Current
liabilities:Short-term debt0230Accounts payable440279Payable
to GLOBALFOUNDRIES255245Payable to ATMP
JV1280Accrued liabilities[1]391472Other current
liabilities69124Deferred income on shipments to
distributors6353Total current liabilities1,3461,403Long-term
debt, net[2]1,4352,007Other long-term
liabilities[1]12486Commitments and contingencies (see Notes
16 and 17)Stockholders’ equity (deficit):Common stock, par
value $0.01; 1,500 shares authorized on December 31, 2016 and
December 26, 2015; shares issued: 949 shares on December 31,
2016 and 806 shares on December 26, 2015; shares outstanding:
935 shares on December 31, 2016 and 792 shares on December
26, 201598Additional paid-in capital8,3347,017Treasury stock,
at cost (14 shares on December 31, 2016 and December 26,
2015 )-119-123Accumulated deficit-7,803-7,306Accumulated
other comprehensive loss-5-8Total stockholders’ equity
(deficit)416-412Total liabilities and stockholders’ equity
(deficit)$3,321$3,084[1]
Amounts reflected adoption of FASB ASU 2015-17, Balance
Sheet Classification of Deferred Taxes beginning in the first
quarter of 2016.
[2]
Amounts reflected adoption of FASB ASU 2015-03, Simplifying
the Presentation of Debt Issuance Costs beginning in the first
quarter of 2016.
AMD Statement of Cash FlowsConsolidated Statements of Cash
Flows - USD ($) $ in Millions12 Months EndedDec. 31,
2016Dec. 26, 2015Dec. 27, 2014Cash flows from operating
activities:Net loss$ (497)$ (660)$ (403)Adjustments to
reconcile net loss to net cash provided by (used in) operating
activities:Net gain on sale of equity interests in ATMP
JV(146)00Equity in loss of ATMP JV200Depreciation and
amortization133167203Provision for deferred income
taxes1100Stock-based compensation expense866381Non-cash
interest expense211117Goodwill impairment

charge00233Restructuring and other special charges,
net08314Net loss on debt redemption68061Fair value of warrant
issued related to sixth amendment to the
WSA24000Other(8)(3)(13)Changes in operating assets and
liabilities:Accounts
receivable2222807Inventories(73)(11)199Prepayment and other
- GLOBALFOUNDRIES184(113)Prepaid expenses and other
assets(166)(111)(7)Payable to ATMP JV12800Payable to
GLOBALFOUNDRIES1027(146)Accounts payables, accrued
liabilities and other58(156)(231)Net cash provided by (used in)
operating activities90(226)(98)Cash flows from investing
activities:Net Proceeds from sale of equity interests in ATMP
JV34200Purchases of available-for-sale
securities0(227)(790)Purchases of property, plant and
equipment(77)(96)(95)Proceeds from maturities of available-
for-sale securities0462873Proceeds from sale of property, plant
and equipment080Other200Net cash provided by (used in)
investing activities267147(12)Cash flows from financing
activities:Proceeds from (repayments of) borrowings,
net(230)10075Proceeds from issuance of senior notes, net of
issuance costs78201,080Proceeds from issuance of common
stock, net of issuance costs66700Proceeds from issuance of
common stock under stock-based compensation equity
plans2054Repayments of long-term debt and capital lease
obligations(1,113)(44)(1,115)Other(4)(2)2Net cash provided by
financing activities1225946Net increase (decrease) in cash and
cash equivalents479(20)(64)Cash and cash equivalents at
beginning of year785805869Cash and cash equivalents at end of
year1,264785805Supplemental disclosures of cash flow
information:Cash paid during the year for
interest149149138Cash paid during the year for income
taxes2037Non-cash financing activity:Issuance of common
stock to partially settle the 7.00% Notes$ 8$ 0$ 0
INTC Income StatementConsolidated Statements of Income -
USD ($) shares in Millions, $ in Millions12 Months EndedDec.
31, 2016Dec. 26, 2015Dec. 27, 2014Income Statement

[Abstract]Net revenue$ 59,387$ 55,355$ 55,870Cost of
sales23,19620,67620,261Gross
margin36,19134,67935,609Research and
development12,74012,12811,537Marketing, general and
administrative8,3977,9308,136Restructuring and other
charges1,886354295Amortization of acquisition-related
intangibles294265294Operating
expenses23,31720,67720,262Operating
income12,87414,00215,347Gains (losses) on equity
investments, net506315411Interest and other,
net(444)(105)43Income before
taxes12,93614,21215,801Provision for taxes2,6202,7924,097Net
income$ 10,316$ 11,420$ 11,704Basic earnings per share of
common stock$ 2.18$ 2.41$ 2.39Diluted earnings per share of
common stock$ 2.12$ 2.33$ 2.31Weighted average shares of
common stock outstanding:Basic
(shares)4,7304,7424,901Diluted (shares)4,8754,8945,056
INTCl Balance SheetConsolidated Balance Sheets - USD ($) $
in MillionsDec. 31, 2016Dec. 26, 2015Current assets:Cash and
cash equivalents$ 5,560$ 15,308Short-term
investments3,2252,682Trading assets8,3147,323Accounts
receivable, net of allowance for doubtful accounts of $37 ($40
in 2015)4,6904,787Inventories5,5535,167Assets held for
sale5,21071Other current assets2,9562,982Total current
assets35,50838,320Property, plant and equipment,
net36,17131,858Marketable equity securities6,1805,960Other
long-term
investments4,7161,891Goodwill14,09911,332Identified
intangible assets, net9,4943,933Other long-term
assets7,1598,165Total assets113,327101,459Current
liabilities:Short-term debt4,6342,634Accounts
payable2,4752,063Accrued compensation and
benefits3,4653,138Accrued advertising810960Deferred
income1,7182,188Liabilities held for sale1,92056Other accrued
liabilities5,2804,607Total current liabilities20,30215,646Long-
term debt20,64920,036Long-term deferred tax

liabilities1,730954Other long-term
liabilities3,5382,841Commitments and Contingencies (Note
20)Temporary equity882897Stockholders' equity:Preferred
stock, $0.001 par value, 50 shares authorized; none
issued00Common stock, $0.001 par value, 10,000 shares
authorized; 4,730 shares issued and outstanding (4,725 issued
and outstanding in 2015) and capital in excess of par
value25,37323,411Accumulated other comprehensive income
(loss)10660Retained earnings40,74737,614Total stockholders’
equity66,22661,085Total liabilities, temporary equity, and
stockholders’ equity$ 113,327$ 101,459
INTC Statement of Cash FlowsConsolidated Statements of Cash
Flows - USD ($) $ in Millions12 Months EndedDec. 31,
2016Dec. 26, 2015Dec. 27, 2014Statement of Cash Flows
[Abstract]Cash and cash equivalents, beginning of period$
15,308$ 2,561$ 5,674Cash flows provided by (used for)
operating activities:Net income10,31611,42011,704Adjustments
to reconcile net income to net cash provided by operating
activities:Depreciation6,2667,8217,380Share-based
compensation1,4441,3051,148Excess tax benefit from share-
based payment arrangements(121)(159)(122)Restructuring and
other charges1,886354295Amortization of
intangibles1,5248901,169(Gains) losses on equity investments,
net(432)(263)(354)Deferred taxes257(1,270)(703)Changes in
assets and liabilities:1Accounts
receivable65(355)(861)Inventories119(764)(98)Accounts
payable182(312)(249)Accrued compensation and
benefits(1,595)(711)4Income taxes payable and
receivable1,382386(286)Other assets and
liabilities5156751,391Total adjustments11,4927,5978,714Net
cash provided by operating activities21,80819,01720,418Cash
flows provided by (used for) investing activities:Additions to
property, plant and
equipment(9,625)(7,326)(10,105)Acquisitions, net of cash
acquired(15,470)(913)(934)Purchases of available-for-sale
investments(9,269)(8,259)(7,007)Sales of available-for-sale

investments3,8522,0901,227Maturities of available-for-sale
investments5,6546,1688,944Purchases of trading
assets(12,237)(11,485)(14,397)Maturities and sales of trading
assets10,90713,37213,165Investments in loans receivable and
reverse repurchase agreements(223)(2,550)(150)Collection of
loans receivable and reverse repurchase
agreements9112,116117Investments in non-marketable equity
investments(963)(2,011)(1,377)Other investing646615612Net
cash used for investing activities(25,817)(8,183)(9,905)Cash
flows provided by (used for) financing activities:Increase
(decrease) in short-term debt, net(15)(474)235Excess tax
benefit from share-based payment
arrangements121159122Issuance of long-term debt, net of
issuance costs2,7349,4760Repayments of Long-term
Debt(1,500)00Proceeds from sales of common stock through
employee equity incentive plans1,1088661,660Repurchase of
common stock(2,587)(3,001)(10,792)Restricted stock unit
withholdings(464)(442)(332)Payment of dividends to
stockholders(4,925)(4,556)(4,409)Collateral associated with
repurchase of common stock0325(325)Increase (decrease) in
liability due to collateral associated with repurchase of common
stock0(325)325Other financing(211)(116)(95)Net cash provided
by (used for) financing activities(5,739)1,912(13,611)Effect of
exchange rate fluctuations on cash and cash
equivalents01(15)Net increase (decrease) in cash and cash
equivalents(9,748)12,747(3,113)Cash and cash equivalents, end
of period5,56015,3082,561Supplemental
disclosures:Acquisitions of property, plant, and equipment
included in accounts payable and accrued
liabilities979392985Interest, net of capitalized interest and
interest rate swap payments/receipts682186167Income taxes,
net of refunds$ 877$ 3,439$ 4,639
Question 5Annual percentage change in Revenues=Current
Revenue - Revenue of Previous YearRevenue of Previous
YearIntel Corporation
(INTC)2016=$59,387,000˗$55,355,000=$4,032,000.00=7.28%$

55,355,000$55,355,0002015=$55,355,000˗$55,870,000=-
$515,000.00=-
0.92%$55,870,000$55,870,0002014=$55,870,000˗$53,341,000=
$2,529,000.00=4.74%$53,341,000$53,341,000Advanced Micro
Devices, Inc.
(AMD)2016=$4,272,000˗$3,991,000=$281,000.00=7.04%$3,991
,000$3,991,0002015=$3,991,000˗$5,506,000=-$1,515,000.00=-
27.52%$5,506,000$5,506,0002014=$5,506,000˗$5,299,000=$20
7,000.00=3.91%$5,299,000$5,299,000Annual percentage
change in income=Current Net Income - Net Income of Previous
YearNet Income of Previous YearIntel Corporation
(INTC)2016=$10,316,000˗$11,420,000=-$1,104,000.00=-
9.67%$11,420,000$11,420,0002015=$11,420,000˗$11,704,000=
-$284,000.00=-
2.43%$11,704,000$11,704,0002014=$11,704,000˗$9,620,000=$
2,084,000.00=21.66%$9,620,000$9,620,000Advanced Micro
Devices, Inc. (AMD)2016=-$497,000˗-
$660,000=$163,000.00=24.70%-$660,000-$660,0002015=-
$660,000˗-$403,000=-$257,000.00=-63.77%-$403,000-
$403,0002014=-$403,000˗-$83,000=-$320,000.00=-385.54%-
$83,000-$83,000
Question 6Current ratio=Current AssetsCurrent LiabilitiesIntel
Corporation
(INTC)2016=$35,508,000=1.75$20,302,0002015=$38,320,000=
2.45$15,646,0002014=$27,730,000=1.73$16,011,000Advanced
Micro Devices, Inc.
(AMD)2016=$2,530,000=1.88$1,346,0002015=$2,320,000=1.65
$1,403,0002014=$2,736,000=1.90$1,440,000Quick
Ratio=Current Assets - InventoriesCurrent LiabiltiesIntel
Corporation
(INTC)2016=$35,508,000˗$5,553,000=$1.48$20,302,0002015=$
38,320,000˗$5,167,000=$2.12$15,646,0002014=$27,730,000˗$4
,273,000=$1.47$16,011,000Advanced Micro Devices, Inc.
(AMD)2016=$2,530,000˗$751,000=$1.32$1,346,0002015=$2,32
0,000˗$678,000=$1.17$1,403,0002014=$2,736,000˗$685,000=$
1.42$1,440,000Days Receivables Outstanding=Account

ReceivableSales/365Intel Corporation
(INTC)2016=$4,690,000=29$59,387,000÷3652015=$4,787,000=
32$55,355,000÷3652014=$6,385,000=42$55,870,000÷365Advan
ced Micro Devices, Inc.
(AMD)2016=$311,000=27$4,272,000÷3652015=$533,000=49$3
,991,000÷3652014=$818,000=54$5,506,000÷365Days Inventory
Held=Inventory*365Cost of SalesIntel Corporation
(INTC)2016=$5,553,000*365=87$23,196,0002015=$5,167,000*
365=91$20,676,0002014=$4,273,000*365=77$20,261,000Advan
ced Micro Devices, Inc.
(AMD)2016=$751,000*365=84$3,274,0002015=$678,000*365=
85$2,911,0002014=$685,000*365=68$3,667,000Debt/Total
Capital=Liabilities(Liabilities + Stockholders Equity)Intel
Corporation
(INTC)2016=$46,219,000=0.41$46,219,000+$66,226,0002015=
$39,477,000=0.39$39,477,000+$61,085,0002014=$35,123,000=
0.39$35,123,000+$55,865,000Advanced Micro Devices, Inc.
(AMD)2016=$2,905,000=0.87$2,905,000+$416,0002015=$3,49
6,000=1.13$3,496,000+-
$412,0002014=$3,580,000=0.95$3,580,000+$187,000
Question 7Net Income/Total Cash from OperationsIntel
Corporation
(INTC)2016=$10,316,000=0.47$21,808,0002015=$11,420,000=
0.60$19,017,0002014=$11,704,000=0.57$20,418,000Advanced
Micro Devices, Inc. (AMD)2016=-$497,000=-
5.52$90,0002015=-$660,000=2.92-$226,0002014=-
$403,000=4.11-$98,000Total Cash from Operations/Total of All
Cash InflowsIntel Corporation (INTC)2016=$21,808,000=-
2.237-
$9,748,0002015=$19,017,000=1.492$12,747,0002014=$20,418,
000=-6.559-$3,113,000Advanced Micro Devices, Inc.
(AMD)2016=$90,000=0.188$479,0002015=-$226,000=11.300-
$20,0002014=-$98,000=1.531-$64,000
Question 8Return on Equity=Net IncomeTotal Shareholders
EquityIntel Corporation
(INTC)2016=$10,316,000=15.58%$66,226,0002015=$11,420,00

0=18.70%$61,085,0002014=$11,704,000=20.95%$55,865,000A
dvanced Micro Devices, Inc. (AMD)2016=-$497,000=-
119.47%$416,0002015=-$660,000=160.19%-$412,0002014=-
$403,000=-215.51%$187,000Profit Margin=Net
IncomeRevenueIntel Corporation
(INTC)2016=$10,316,000=17.37%$59,387,0002015=$11,420,00
0=20.63%$55,355,0002014=$11,704,000=20.95%$55,870,000A
dvanced Micro Devices, Inc. (AMD)2016=-$497,000=-
11.63%$4,272,0002015=-$660,000=-16.54%$3,991,0002014=-
$403,000=-7.32%$5,506,000Total Asset
Turnover=RevenueTotal AssetsIntel Corporation
(INTC)2016=$59,387,000=0.524$113,327,0002015=$55,355,00
0=0.546$101,459,0002014=$55,870,000=0.608$91,900,000Adv
anced Micro Devices, Inc.
(AMD)2016=$4,272,000=1.286$3,321,0002015=$3,991,000=1.2
94$3,084,0002014=$5,506,000=1.462$3,767,000Equity
Multiplier=Total AssetsShareholders' EquityIntel Corporation
(INTC)2016=$113,327,000=1.711$66,226,0002015=$101,459,0
00=1.661$61,085,0002014=$90,012=0.002$55,865,000Advance
d Micro Devices, Inc.
(AMD)2016=$3,321,000=7.983$416,0002015=$3,084,000=-
7.485-$412,0002014=$3,737,000=19.984$187,000
Course Code + CourseTitle
Reading Assignment
_____________________________________________________
________________________________________
Assigned Reading
Reading Assignment: Reflection Essay
You will write a short reflection essay on an assigned reading.
This essay should be in your own words, demonstrate persuasive

expositional style, incorporate professional syntax and diction,
and communicate critical thinking and understanding. Your
personal thoughts, feelings, reactions and conclusions should be
supported by argument and examples.
The essay will consist of three (3) paragraphs, each containing
five (5) sentences. The paragraphs will conform to classical
paragraph structure: first, one topic sentence; followed by three
supporting statement sentences; and last, a concluding sentence,
which should be your reader’s take-away.
Paragraph 1 – What was the subject of the reading? What was
the main idea advanced by the writer, or the key point made?
What did you find most interesting, or important?
Paragraph 2 – Why did you find the subject, or the main idea,
important? What was its special significance? What does it
mean to you?
Paragraph 3 - What have you learned? How has your thinking
changed? Are you motivated to take further action? If so, what?
This project will be assessed for form as well as content – your
essay must be neat, well organized, and easy to read. Assessable
criteria include spelling, punctuation, usage, agreement, syntax
& grammar; typographic selection & usage; page layout & the
arrangement of text on the page; and the care and consistency
with which it is executed. Your essay is due at the start of the
next class, and must be bound into your final portfolio to be
turned in at the end of the quarter.
Learning Outcomes
CIDA Indicator #
CIDA Indicator
Comment
5b
Students have awareness of terminology and language necessary
to communicate effectively with members of allied disciplines.
The reflection essay exposes students to professional writing
and requires them to respond in an appropriately using technical
terms and criteria when engaging topical content, page layout,

typographic design, publication design, and information
architecture.
9c
Students are able to effectively express ideas in written
communication.
The reflection essay requires students to write effective prose,
to communicate topical information, persuasively advance a
relevant response, and write with a purpose: tone, texture,
scope, mood, and objective.
10a
Students understand social, political, and physical influences
affecting historical in design of the built environment.
The reflection essay requires students to engage, interpret, and
integrate issues and matters discussed in the assigned reading
with prior learning so they can demonstrate understanding and
insight related to the matters discussed in the reading
assignment in the form of a reflection essay.
11a
Students understand the elements and principles of design,
including spatial definition and organization.
The reflection essay requires effective expositional prose,
incorporating rhetorical devices such as dissonance (contrast),
alliteration/assonance(repetition), consonance (proximity), and
rhyme (alignment); and be able to produce readable, accessible
text, using a layout grid, typographic hierarchy, and an
appropriate balance between active and passive space.
Conducting Financial Analysis to Accomplish Strategic Goals
for Your Organization
ANTHONY AMOBI, BIROM BAH, DANIELLE BALSON,
EDWINA CRABLE, AND TONIA CRUSOE
UNIVERSITY OF MARYLAND UNIVERSITY COLLEGE

25 APRIL, 2017
Introduction
About IPS
Slide show will analyze IPS’s:
Price , cost, and profit analysis
Industry structure, cost, and prices
Optimal production levels for an overall analysis
Q1. Analyze Industry Structure, Cost and Optimal Production
Levels
Price change vs. demand; it remains constant at 50,000 units.
MiniZ is an oligopolistic market:
Few major players in the industry
behaves Strategically
Major policy change from one firm will likely have a countering
impact by remaining firms
Kumar, M. (2016, August 28). Top 9 Characteristics of
Oligopoly Market. Retrieved from

http://www.economicsdiscussion.net/oligopoly/top-9-
characeristic-of-oligopoly
Q2. Price Cost, and Profit Analysis
Profit maximizing levels in a competitive and oligopolistic
industry
Marginal cost at this point is equal to the average total cost
Maximum profit occurs when marginal cost equals marginal
revenue
IPS will profit more when:
Marginal revenue rises above the marginal cost
IPS loses money when:
The price goes below the marginal cost
Maximum profit occurs when the goods or services are priced
such that marginal cost, which is the change in the cost of
producing one more unit of good or service is equal to marginal
revenue – the extra revenue created from the sale of an extra
unit of good or service.

Q3. Price Cost, and Profit Analysis
As the number of units produced increase, the price of each unit
decreases. The maximum profit is where marginal cost is equal
to marginal revenue.
Maximum profit = $17,500,000.00
Quantity at maximum profit = 22,500 units
Price at maximum profit = $1,100.00
Average total cost at maximum profit = $322.22
Q4. Financial Statements Explained
Balance Sheet (Assets = Liabilities + Owner’s Equity)
Identifies a Firm’s assets at a point in time
Income Statement (Net income = Revenues - Expenses)
Reports a firm's economic activity at a point in time
Statement of Cash Flows - measures cash inflows and outflows
through:
Operations
Investing
Financing

Q4. $1.5M Accounts Receivable Write-off
Financial Statements Impacted:
Balance Sheet, Income Statement, and Statement of Cash Flows
Result:
Bad debt expense will increase by 1.5M
Allowance for doubtful account will decrease by $1.5M
Allowance for doubtful account will increase by by $1.5M
Accounts receivable will decrease by 1.5M
Averkamp, Harold, MBA, CPA. (n.d.) How do you write off a
bad account? Accounting coach. Retrieved from
https://www.accountingcoach.com/blog/how-do-you-write-off-
a-bad-account
IPS will have a write-off of an Accounts Receivable amount of
$1.5 million. The company that owed this amount went
bankrupt; therefore, IPS does not expect to retrieve any of the
money owed. This leads to a decrease in the firm's current
assets and the total assets.
This should affect the balance sheet, income statement and cash
flow statement. There will not be an expense or loss recorded
for this on the income statement, as the debt will be written off

or adjusted as a bad debt. It will possibly be adjusted as an
income loss and expected that IPS would lose $1.5 million in
projected income. Meanwhile, IPS will take credit for the same
amount of their accounts receivables.
As well, the write-off will be accurately reflected in the
financial statements and could have potential tax savings due to
the loss of expected income. It is widely assumed that a
company as large as IPS should realistically expect to have a
write-off due to the nature of their business.
Q4. Sale of Property, Plant, and Equipment (PPE)
Balance Sheet, Income Statement & Statement of Cash Flow
Results:
Cash should increase by $7.1M
Sell-off of $5M in assets
PPE will fall fall by $5M
Retained earning should increase by $2.1M
Liabilities and owner's equity should increase by $2.1M
Net income should rise by $2.1M
Investing cash flows will increase by $7M
Averkamp, Harold, MBA, CPA. (n.d.) How do you calculate the
gain or loss when an asset is sold? Accounting coach.
Retrieved from https://www.accountingcoach.com/blog/gain-
loss-sale-of-asset
IPS sold a Property, Plant, and Equipment asset valued at $5

million for cash, which generated a profit of $2.1 million. The
related financial reports will change and reflect the sale of the
assets. The company gained additional $7.1 to add onto their
cash balance. This should mostly affect the balance sheet, but is
also recorded in the income statement and cash flow.
Meanwhile, the PPE (sale of property, plant, and equipment)
should fall by $5 million due to the sale of the various assets.
IPS also gained $5 million in net income, and that help the
company re-invest their money. Overall, the company will have
additional $7 million for cash flow.
Q4. 10% Discount on Goods Sold
Income Statement and Statement of cashflows
Result:
Cash will increase by 7.2M
Sales discount will increase by 800K
Accounts receivable will decrease by 7.2M
IPS gave a 10 percent discount to a customer. This discount was
not recorded, reducing the revenues of the goods sold to the
customer from $8 million to $7.2 million.
This should affect the overall financial reports in general. IPS
did gain another $7.2 million in cash and should be reflected on
their income statement. However, the discount on the sale will
lead the accounts receivable to be reduced by $800,000 to $7.2

million.
Q4. Total Effects of Missing Transactions
Net cash inflows is decreased by $200K
Net Income will decrease by $200K
Cash is increased by $1.3M
Accounts receivable is decreased by $1.5M
Total assets decrease by $200K
Net Income is decreased by 1.5M
Stockholders equity is decreased by 200K
Q4. Conclusion
Firm not financially viable when omitted transactions are
accounted for
Firm's financial position is overstated by 200K
IPS should try to improve its financial status
Q5. Comparative Analysis2016201520147.28%-0.92%4.74%
Revenue Increased201620152014-9.67%-2.43%21.66%
Net Income Decreased
INTEL2016201520147.04%-27.52%3.91%
Revenue Increased20162015201424.70%-63.77%-385.54%

Net Income Increased
AMD
Q6. Balance Sheet Ratios - Intel
Current Ratio 2016201520141.752.451.73
Quick
Ratio201620152014$1.48$2.12$1.47201620152014293242
Days Receivables Outstanding201620152014879177
Days Inventory Held
Debt/Total Capital2016201520140.140.390.39
Q6. Balance Sheet Ratios - AMD2016201520141.881.651.90
Current Ratio
Quick
Ratio201620152014$1.32$1.17$1.42201620152014274954
Days Receivables Outstanding201620152014848568
Days Inventory Held
Debt/Total Capital2016201520140.871.130.95
Q7. Cash Flow Ratios - Intel &
AMD2016201520140.470.600.57

Net Income/Total Cash from Operations201620152014-
2.2371.492-6.559201620152014-5.522.924.11
Net Income/Total Cash from Operations
Total Cash from Operations/Total of All Cash
Flows2016201520140.18811.3001.531
Total Cash from Operations/Total of All Cash Flows
AMD
INTEL
Q8. Profitability Ratios - Intel
Return on Equity 20162015201415.58%18.70%20.95%
Profit
Margin20162015201417.37%20.63%20.95%2016201520141.711
1.6610.002
Equity Multiplier2016201520140.5240.5460.608
Total Asset Turnover
Q8. Profitability Ratios - AMD
Return on Equity 201620152014-119.47%160.19%-215.51%
Profit Margin201620152014-11.63%-16.54%-
7.32%2016201520147.983-7.48519.984
Equity Multiplier2016201520141.2861.2941.462
Total Asset Turnover

Q9. What is management's view of the significant risks and
important aspects of the business?
Risks - Intel
Changes in Product Demand
Global Operations
Product Development
Complexity of Manufacturing
Supply Chain Risk
Defective Products
Environmental laws and regulations
Intellectual Property/Licenses
Cyber security
Risks - AMD
Changes in Product Demand
Credit Risk
Liquidity Risk
Cash Generation
Ineffective Personnel/Hiring
Third party distributors
Exchange Rate in other countries
The management's view of the significant risks and important
aspects of the business are. Intel’s risk factors are shown to be
changes in product demand that can affect the financial results
in. Demand for products varies and is hard to predict. There is
stiff competition in the industry and changes in the mix of
products. There is risk in operating globally with regional

conditions. There is fluctuation in the currency exchange rate
There is also Cyber security and privacy risks.
The risks involved with AMD are various in nature they range
from changes in product demand, Inability to continue to attract
and retain qualified personnel and a risk with Foreign exchange.
Q9. What is management's view of the significant risks and
important aspects of the business?
Important Aspects - Intel
Operating Segments
Competition
Market Position
Complexity of Manufacturing
Technology
Customers
Sales/Marketing
Distributors
Seasonal Trends
Intellectual Property
Management/Leadership/Employees
Environmental Law/Regulations
Important Aspects - AMD
Worldwide semiconductor company
Technology
Intellectual Property
Sales/Marketing
Customers
Competition
Research Development
Seasonal Trends
Management/Leadership/Employees
Environmental Law/Regulations

Q10. What is the name of the accounting firm that audited the
Financial Statements and what was the opinion expressed?
Intel - Firm: Ernst & Young LLP
Opinion:
Financial statements for the past three years were presented
fairly
All material aspects and in conformity with U.S. generally
accepted accounting principles
AMD - Firm: Ernst & Young LLP
Opinion:
Financial statements for the past three years were presented
fairly
All material aspects and in conformity with U.S. generally
accepted accounting principles
The accounting firm that audited Intel Corporation’s financial
statements was Ernst & Young LLP. They expressed this
opinion.
“In our opinion, the financial statements referred to above
presents fairly, in all material respects, the consolidated
financial position of Intel Corporation at December 31, 2016
and December 26, 2015, and the consolidated results of its
operations and its cash flows for each of the three years in the
period ended December 31, 2016, in conformity with U.S.
generally accepted accounting principles. Also, in our opinion,
the related financial statement schedule, when considered in
relation to the basic financial statements presents fairly in all
material respects the information set forth therein.
Ernst & Young LLP audited Advanced Micro Devices Inc’s

financial statements also with an expressed opinion.
“In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Advanced Micro Devices, Inc. at December
31, 2016 and December 26, 2015, and the consolidated results
of its operations and its cash flows for each of the three years in
the period ended December 31, 2016, in conformity with U.S.
generally accepted accounting principles.”
Q11. Which members of the management team were responsible
for preparing and issuing the Financial Statements?
The audit/finance and accounting committees were responsible
for preparing the financial statements.
An internal auditor
Board of Directors
The members of the management team responsible for preparing
and issuing the Financial Statements Intel and AMID were the
audit and finance/accounting committees. They were
responsible for preparing the financial statements. The Internal
auditors, Management and the Board of Directors were also
involved in the preparation and issuance of financial statements
Q12. What is management's view on the causes of the changes
in financial results?
Intel
$59.4 billion in 2016, up $4.0 billion, or 7%, from 2015 was
attributed to the inclusion of other businesses.

Profitability decrease attributed to acquisitions which was
partially offset by lower platform unit costs, platform volume,
and higher platform average selling prices.
Research and development costs have increased
2016 Restructuring Program
AMD
Increase in net revenue from 2015 was attributed to a 9%
increase in Computing & Graphics segment revenue and a 5%
increase in Enterprise.
Decrease in gross margin was attributed to $340 million charge
taken in the third quarter of 2016.
This is the management’s view on the causes of the changes in
financial results. For Intel: we achieved record revenue of $59.4
billion in 2016, which was up $4.0 billion, or 7%, from 2015.
This increase was driven by the inclusion of PSG and growth in
the DCG, CCG, and IOTG businesses. The net income for 2016
was $10.3 billion, and cash flow from operations was $21.8
billion.
The earnings per share of $2.12 were down 21 cents, or 9%
from a year ago. This decrease was primarily driven by higher
restructuring and other charges, higher spending, and higher
amortization of acquisition-related intangibles. The decrease
was partially offset by platform volume and higher platform
average selling prices
Restructuring and other charges came to $1.9 billion, primarily
driven by our 2016 Restructuring Program. We had a record
cash flow from operations in 2016 which was approximately
$21.8 billion. During 2016, we acquired Altera and other
smaller acquisitions for $15.5 billion. We purchased $9.6
billion in capital assets, paid $4.9 billion in dividends, and
repurchased $2.6 billion in stock. We issued $2.8 billion of

long-term debt and assumed $1.5 billion as part of the Altera
acquisition.
AMD: had a net revenue for 2016 of $4.3 billion, an increase of
7% compared to 2015 net revenue of $4.0 billion. The increase
in net revenue from 2015 was due to a 9% increase in
Computing and Graphics segment revenue and a 5% increase in
Enterprise, Embedded and Semi-Custom segment revenue.
Revenue increased year-over-year primarily due to higher semi-
custom SoC sales. Operating loss for 2016 was $372 million
compared to a $481 million for 2015. This improvement in
operating performance in 2016 compared to 2015 was due to an
increase in net revenue.
During 2016, we continued to execute our roadmap by
delivering various numbers of new products and technologies
across our two business segments.
References
Averkamp, Harold, MBA, CPA. (n.d.) How do you write off a
bad account? Accounting coach. Retrieved from
https://www.accountingcoach.com/blog/how-do-you-write-
off-a-bad-account
Averkamp, Harold, MBA, CPA. (n.d.) How do you calculate the
gain or loss when an asset is sold? Accounting coach.
Retrieved from
https://www.accountingcoach.com/blog/gain-loss-sale-of-
asset
Kumar, M. (2016, August 28). Top 9 Characteristics of
Oligopoly Market. Retrieved from
http://www.economicsdiscussion.net/oligopoly/top-9-
characeristic-of-oligopoly
United States Securities and Exchange Commission. (2016a July
8). Advanced micro devices inc. Retrieved from
https://www.sec.gov/cgi-

bin/viewer?action=view&cik=2488&accession_number=000000
2488-17-000043&xbrl_type=v
United States Securities and Exchange Commission. (2016b July
5). Intel corp. Retrieved from https://www.sec.gov/cgi-
bin/viewer?action=view&cik=50863&accession_number=00000
50863-17-000012&xbrl_type=v
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