Question

In: Finance

How does Amazons investing activities impact the balance sheet, income statement, income statement, cash flow and...

How does Amazons investing activities impact the balance sheet, income statement, income statement, cash flow and shareholder equity based on 10 K filing report? Remainder of Excel spreadsheets too long to include.

Solutions

Expert Solution

Amazon's investing activities are primarily comprising of investment in fixed assets. The investment is being used towards addition to fixed capital.

Impact on the balance sheet:

  1. Reduces the surplus cash balance on the balance sheet
  2. Increases the debt on the balance sheet required to part fund the investment activities
  3. Investing activities increases the gross / net fixed assets on the balance sheet

Impact on Income statement:

  1. Leads to depreciation and amortization expenses on the income statement
  2. Debt funding of the investment activities leads to increase in interest cost

Impact on cash flow

  1. The cash flow due to investing activities is negative.
  2. It set's off cash flow from operating activities and financing activities
  3. Appears as capital investment on the cash flow statement

Impact on shareholder equity:

  1. Investing activities in nth years leads to increase in profits next year. Any capital investment starts generating revenue for the firm. This incremental revenue translates into the profits of the firm and increases shareholder's equity in the long run.

Related Solutions

How does a balance sheet relate to a cash flow statement?
How does a balance sheet relate to a cash flow statement?
How does Amazons financing activities (proceeds from long term debt) impact the balance sheet, income statement,...
How does Amazons financing activities (proceeds from long term debt) impact the balance sheet, income statement, cash flow and shareholders equity based on 2017 10 K filing report? https://www.sec.gov/.../000101872418000005/amzn-20171231x10k.htm
What information is shown on an income statement, a balance sheet, and a cash flow statement?
What information is shown on an income statement, a balance sheet, and a cash flow statement?
Discuss the relationship between the balance sheet, income statement, statement of cash flow and, statement of...
Discuss the relationship between the balance sheet, income statement, statement of cash flow and, statement of owner’s equity?
1.  What information does the Income Statement, Balance Sheet and Cash Flow Statement provide to various users?...
1.  What information does the Income Statement, Balance Sheet and Cash Flow Statement provide to various users? Why is the Income Statement constructed first and the Cash Flow Statement contructed last? What type of accounts are in each statement? 2. What is the difference between an accrual basis and cash basis of accounting? What type of companies might use each basis and why? What is GAAP and who determines GAAP? What is IFERs and what impact might it have in the...
explain how the balance sheet, income statement and statement of cash flow interrelated. What ties them...
explain how the balance sheet, income statement and statement of cash flow interrelated. What ties them together
explain Income statement, balance sheet and cash flow . 500 words
explain Income statement, balance sheet and cash flow . 500 words
Fill in the blanks in the income statement and balance sheet and show that Cash Flow...
Fill in the blanks in the income statement and balance sheet and show that Cash Flow Identity holds. If the company sold $300 worth of fixed assets, how much fixed assets were sold? Assuming that the company had either seasoned equity offering or repurchase, which one did the company have? If the company borrowed $55 in 2018, how much of the Long-term debt was paid in 2018? BALANCE SHEET - 2017 & 2018 ASSETS LIABILITIES and OWNERS EQUITY 2017 2018...
Based on the information below create an income statement, balance sheet, and cash flow statement. On...
Based on the information below create an income statement, balance sheet, and cash flow statement. On January 2, 2003, Alexander, together with a number of relatives and friends, established Chemalite, Inc.; 500,000 shares were issued, of which Alexander received 125,000 in exchange for his patent, and the remainder were sold to the other investors at $1 per share. During the period January 2, 2003, through June 30, 2003, Chemalite, Inc., made the following expenditures: January 15—Paid $7,500 in legal fees,...
Prepare an income statement, balance sheet and cash flow statement for the year 2023 The question...
Prepare an income statement, balance sheet and cash flow statement for the year 2023 The question no longer need to be answered
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT