Question

Use most recent (2019) Form 10-K for Snap-on Inc. to complete the requirements below. To obtain the Form 10-K, you can search EDGAR system at sec.gov or search “Corporate Information” on the company's corporate website at www.snapon.com (Links to an external site.). Read carefully the following portions of the document:

A. First section entitled "10-K"

B. Notes to Financial Statements:

• Note 1 -> Summary of Accounting Policies
  • “Shipping and handling”
  • “Advertising and promotion”
• “Note 4: Inventories”

Questions:

1. Looking in the "10-K" (first section) How long has Snap-On been in business? Where are Snap-On's Executive Offices located? What is its trading symbol? Cite your source. (2-3 sentences)
2. What are the main products sold by SnapOn? Be specific. Cite your source. (1 sentence)
3. Snap-on treats shipping and handling costs as BOTH a product cost and also as a period cost. Explain what part of shipping and handling is included as a product cost? What part of shipping and handling is a period cost? Cite your source (2 -3 sentences)
4. Does Snap-on treat advertising and promotion costs as product or period costs? How can you tell? Cite your source. (2-3 sentences)
5. What are the three main categories of inventory does Snap-on report in its annual report? What is the current value of Snap-On's total Inventory on the Balance Sheet? (Indicate if it is "in thousands" or "in millions.") Cite your source.
6. After browsing the annual report, comment on one more interesting thing (nonfinancial) that you learned about Snap-On Inc. in doing your research. Explain why you found it to be particularly interesting. (2-3 detailed sentences.) Cite your source.

Required:

• Answer each of the above questions in complete sentences.
• Be sure to fully cite your sources used for each of your answers in 1-6. (One source per item. Example; "Balance Sheet-> Assets section" or "Statement of Cash Flows -> Investing Activities section." )

Answer 1

Q.How long has Snap-On been in business? Where are Snap-On's Executive Offices located? What is its trading symbol?

Snap-On started its business In 1920, now its a 100 years aged company.

Executive Offices are,

Kenosha (HQ), WI

United States

2801 80th St

Algona, IA

United States

2600 US-18

Conway, AR

United States

309 Exchange Ave

Elizabethton, TN

United States

2195 State Line Rd

Elkmont, AL

United States

18771 Carters Cir

Lebanon, NH

United States

10 Technology Dr, West Lebanon

Milwaukee, WI

United States

7939 N Faulkner Rd

Murphy, NC

United States

250 Snap On Dr

Richfield, OH

United States

4025 Kinross Lakes Pkwy

Rochester Hills, MI

United States

2950 Waterview Dr

Rowland Heights, CA

United States

19220 San Jose Ave

South Park View, KY

United States

2311 S Park Rd

Wixom, MI

United States

29900 Anthony Dr

Carol Stream, IL

United States

Arndell Park

Australia

80 Holbeche Rd

St. Corona am Wechsel

Austria

Hauptstrasse 24 / Top 14 a

Santa Bárbara d'Oeste

Brazil

Av. Juscelino K. de Oliveira, 470 - Distrito Industrial II

Hangzhou

China

1879 Yatai Rd, Xiaoshan Qu

Kunshan

China

500 Tongfeng E Rd

Le Pecq

France

Parc du Saint-Laurent

Saint-Ouen-l'Aumône

France

15 Rue de la Guivernone

Friedberg (Hessen)

Germany

Straßheimer Str. 33

Unterneukirchen

Germany

Konrad-Zuse-Straße 1

Sopron

Hungary

Somfalvi út 13

Ahmedabad

India

Bodakdev

Bengaluru

India

No.56, 6B, Palace Rd, Abshot Layout, Vasanth Nagar

Chandigarh

India

Sector 27D, Sector 27

Chennai

India

Kumaran Colony, Vadapalani

Kolkata

India

35 , 40/1,Ballygunge Circular Road, Circular Road, Ballygunge, Ballygunge

Lucknow

India

Faizabad Road,Ismailganj, Faizabad Rd, Vibhuti Khand, Gomti Nagar

Mumbai

India

Dilkap Chambers, Veera Desai Industrial Estate Rd, Veera Desai Industrial Estate, Andheri West

Narsinghpur

India

6/2, Begumpur Khatola, Bihind Grace Toyota Showroom, NH-8

(Link source:https://www.snapon.com/EN/Contact-us)

Trading symbol of Snap-On is NYSE: SNA

(Source: PART II >Item 5: Market for Registrant’s Common Equity and Related Stockholder Matters)

Q.What are the main products sold by SnapOn?

Snap-On's products and services encompass thousands of premium hand tools, power tools, tool storage products (including tool control software and hardware), diagnostics, equipment and related accessories, electronic parts catalogs, warranty analytics solutions, business management systems and services, OEM specialty tools and equipment development and distribution, and OEM facilitation services.

Names Products and Services

Snap-on      Hand tools, power tools, tool storage units, diagnostics and certain equipment

Acesa               Hand tools

ATI                  Tools and equipment

BAHCO                     Hand tools

Belzer                     Hand tools

Blackhawk               Collision repair equipment Blue-Point Hand tools, power tools, tool storage units Cartec                        Safety testing and other equipment

CDI                             Torque measuring instruments

Equipment Solutions         Vehicle manufacturer facilitation services 4

EquiServ                              Equipment maintenance and service

Fish and Hook (design)      Hand tools

Hofmann                     Wheel balancers, lifts, tire changers and aligners Irimo Hand tools

John Bean                     Under car and wheel service equipment

Kansas Jack                  Collision repair equipment

Lindstrom                     Hand tools

Mitchell1                      Repair and service information and shop management systems

Nexiq                              Diagnostics

Palmera                      Hand tools

Pradines                      Hand tools

ShopKey                      Repair and service information and shop management systems

Sioux                             Power tools

Sun                                Diagnostics and service equipment

Texo                              Hoists and lifts for vehicle service shops

Wheeltronic                 Hoists and lifts for vehicle service shops

White                                    Equipment to recover, recycle and recharge refrigerant in vehicle air-conditioning systems and other fluid handling equipment

Williams                              Hand tools

(Source:PART I>Products and Services)

(Link Source:https://www.snapon.com/EN/Our-Company/Our-Brands)

Q.Snap-on treats shipping and handling costs as BOTH a product cost and also as a period cost. Explain what part of shipping and handling is included as a product cost? What part of shipping and handling is a period cost?

Amounts billed to customers for shipping and handling are included as a component of sales. Costs incurred by Snap-on for shipping and handling are generally included as a component of cost of goods sold when the costs relate to manufacturing activities. In 2003, 2002 and 2001, Snap-on incurred shipping and handling charges of $10.9 million, $11.1 million and $11.2 million that were recorded in Cost of goods sold on the accompanying Consolidated Statements of Earnings. Shipping and handling costs incurred in conjunction with selling or distribution activities are generally included as a component of operating expenses. In 2003, 2002 and 2001, Snap-on incurred shipping and handling charges of $46.2 million, $41.0 million and $41.9 million that were recorded in Operating expenses on the accompanying Consolidated Statements of Earnings.

(Source NOTE 2: SUMMARY OF ACCOUNTING POLICIES>Shipping and handling)

(Link Source : http://snapon.gcs-web.com/static-files/5e026df0-9b10-4df0-97a5-749ede81d2b1)

Q.Does Snap-on treat advertising and promotion costs as product or period costs? How can you tell?

Snap-on treat advertising and promotion costs as period costs because as per Snap-on Production costs of future media advertising are deferred until the advertising occurs. All other advertising and promotion costs are generally expensed when incurred. For 2003, 2002 and 2001, advertising and promotion expense totaled $51.0 million, $46.7 million and $47.6 million.

(Link Source : http://snapon.gcs-web.com/static-files/5e026df0-9b10-4df0-97a5-749ede81d2b1)

(Source: NOTE 1: NATURE OF OPERATIONS>Advertising and promotion)

Q.What are the three main categories of inventory does Snap-on report in its annual report? What is the current value of Snap-On's total Inventory on the Balance Sheet?

Inventories by major classification are

Finished goods ,Work in process and Raw materials.

current value of Snap-On's total Inventory on the Balance Sheet is $ 351.1

(Source: NOTE 6: INVENTORIES)

Q.After browsing the annual report, comment on one more interesting thing (nonfinancial) that you learned about Snap-On Inc. in doing your research. Explain why you found it to be particularly interesting.

Snap-on is also involved in various other legal matters that are being defended and handled in the ordinary course of business. Snap-on maintains accruals for such costs that it expects to incur with regard to these matters. Although it is not possible to predict the outcome of these other legal matters, management believes that the results will not have a material impact on Snap-on’s financial statements.

(Source:NOTE 16: CAPITAL STOCK)