The following information was taken from Starbucks Corporation's SEC filings.
| Fiscal Year Ended | |||||||
| October 1, 2017 | October 2, 2016 | ||||||
| Number of employees | 277,000 | 254,000 | |||||
| Revenues (in millions) | $ | 22,387 | $ | 21,316 | |||
| Properties (in thousands) | 6,322 | square feet | 6,277 | square feet | |||
| Total assets (in millions) | $ | 14,366 | $ | 14,313 | |||
| Company-owned stores | 13,275 | 12,711 | |||||
| Net earnings (in millions) | $ | 2,885 | $ | 2,818 | |||
Required
- a. Indicate whether each line of information in the table above would best be described as being primarily financial accounting or managerial accounting in nature.
- c.&d. Based on the data identified as financial or managerial in nature from requirement (a), does it appear that Starbucks' 2017 fiscal year was better or worse than its 2016 fiscal year?
- e. Calculate the revenue and earnings per employee and per thousand feet to determine which year (2017 or 2016) Starbucks appeared to be using its facilities more efficiently.
Explanationa.
The information described in the table is primarily managerial accounting information, as much of it refers to nonfinancial measures. The disclosures are not restricted by GAAP or other regulation. The information about revenues, total assets, and earnings are financial in nature, although they are also useful for managerial accounting purposes.
c.
Starbucks’ 2017 fiscal year appears better than 2016 because in 2017 it had higher revenues and net earnings.
d.
Starbucks had more employees and had more sales in 2017 than in 2016, which suggest it was larger, and therefore, appears better.
e.
Starbucks had more revenue and earnings in 2017 than in 2016, but it also had more employees, 277,000 versus 254,000. It also had more property, 6,322 thousand square feet in 2017 versus 6,277 thousand in 2016. These numbers suggest the company used its employees less efficiently in 2017 than in 2016, but it is using its property more efficiently.
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