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course_project__jack_in_the_box_inc.docx
Acct 201 Course Project Assignment #1-IND for [insert company name] page 12
Template for Course Project Assignment #1-INDIVIDUAL[footnoteRef:1] due 11/5/13 [1: Robert Bowen and Jane Jollineau of the University of San Diego prepared this template. It borrows from a project prepared by Mark Judd. Revised: 9/12/13. ]
Learning about your Company, its Financial Statements & tracking its Stock Price
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Your name |
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Other team member(s) |
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Section # |
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To begin, download your Company’s most recent SEC Form 10-K in pdf format from its investor relation’s site,[footnoteRef:2] and use it to answer the questions below in the space provided. You will need to complete one template for each company. [Search hint: every item you want may not be where you expect it. If you cannot find it, type in what you are looking for (e.g., “preferred stock”) into the upper right hand search window in the 10-K pdf file.] [2: To find SEC Form 10-K, go to your company’s investor relation’s site, e.g., http://investor.apple.com and look for “SEC Filings.” You can generally narrow this search by selecting “annual” under “forms.” If you get a choice of file formats to download, choose pdf format for readability and because the file can be searched. ]
Part 1: Basic data on your company
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Company name |
JACK IN THE BOX INC |
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Company stock ticker symbol |
JACK (NASDAQ) |
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Company headquarters location |
9330 BALBOA AVENUE, SAN DIEGO, CA |
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Industry name |
quick-service restaurants |
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CEO (who signed the letter to shareholders) |
LINDA A. LANG - Chief Executive Officer & Chairman of the Board |
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Company’s key Products or Services include: |
Company operates and franchises more than 2,800 Jack in the Box® quick-service restaurants (“QSR”) and Qdoba Mexican Grill ® fast-casual restaurants |
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Customers tend to be: (this of course will be a generalization; examples include: business, consumers, women, young professionals, teens, etc.) |
General Public |
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Closest competitors are: |
Quick Stuff convenience, McDonald’s, Yum Brands, Starbucks, Darden Restaurants
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Part 2: Understanding the financial statements
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Who is the Company’s auditor and where is the audit firm located? |
KPMG LLP, San Diego, California |
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Does the Company follow a fiscal year or calendar year? |
Fiscal year ended September 30 |
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If they do not use a calendar year, why do you believe that is? |
FORM 10-K filed FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2012 |
Part 2A: The Balance Sheet
Find your Company’s Balance Sheet and answer the questions below:
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Insert numbers and compute financial ratios |
Most recent year available |
1st Prior Year |
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What is the balance sheet date? (e.g., 9/30/12 and 9/30/11) |
SEPTEMBER 30, 2012 |
October 2, 2011 |
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What is the dollar amount of total assets? |
1,463,725 |
1,432,322 |
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What is the dollar amount of total liabilities? |
1,051,780 |
1,026,366 |
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What is the dollar amount of total shareholders’ equity? |
411,945 |
405,956 |
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Does A = L + OE? (Yes or No) |
Yes |
Yes |
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Name the Company’s largest asset? Is it “current” or “noncurrent”? |
Building - Non current |
Building - Non current |
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Does the Company have inventory? Why or why not? |
Yes – it is required for the business |
yes– it is required for the business |
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Name the Company’s largest liability? Is it “current” or “noncurrent”? |
Long term debt – non current |
Long term debt – non current |
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What is the dollar amount of contributed capital? (preferred stock + common stock + additional paid-in capital) |
221,858 |
203,434 |
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What is the dollar amount of earned capital? (retained earnings +/- other comprehensive income) |
984,658 |
967,080 |
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Is earned capital increasing or decreasing? Why? |
Increasing – net income |
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Does contributed capital plus earned capital add up to total stockholders’ equity? If not, why not? |
No – Treasury stock is deducted |
No – Treasury stock is deducted |
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Calculate the current ratio (= current assets ÷ current liabilities) – see textbook p. 59 |
0.84:1 |
0.91:1 |
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Based on the current ratio, did the Company become more or less liquid comparing its current year to the prior year? |
Company became less liquid as the current ratio has decreased |
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Calculate the total debt to total assets ratio (= total liabilities ÷ total assets) – see textbook p. 60 |
0.72:1 |
0.72:1 |
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Based on the total debt to total assets ratio computed above, is the Company better off or worse off in its ability to withstand long-term financial difficulties? |
There is no change in debt to total assets ratio. |
What is your overall assessment of your Company’s financial condition? Refer to any of the above numbers or ratios in your brief summary.
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The company is financial stable and strong, as the company has been able to raise 72% of total invested funds. The company has invested its large amount in non-current assets. The biggest investment had been made in buildings.
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Part 2B: The Income Statement
Find your Company’s Income Statement and answer the questions below:
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What is the most recent year used for this analysis? |
2012 |
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How many years of comparative information are provided? (usually = 3) |
3 |
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Insert numbers and compute financial ratios |
Most recent year available |
1st Prior Year |
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What is the dollar amount of total Revenue? |
1,545,026 |
1,662,339 |
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Compute the % change in revenue [= (most recent year’s Revenue ÷ prior year’s Revenue) – 1] |
(7.6%) |
(12.49%) |
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What is the dollar amount of Gross Profit margin? (if given or possible to calculate, Gross Profit = sales revenue minus cost of goods sold) |
343,279 |
321,172 |
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Compute Gross Profit rate (= gross profit ÷ net sales revenue) |
22.22% |
16.9% |
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What is the dollar amount of Operating Income? (if given or possible to calculate, Operating Income is revenues minus expenses related to principal day-to-day operations and is generally shown as a subtotal in the report.) |
112,489 |
145,061 |
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Compute the % change in Operating Income [= (most recent year’s Op Inc ÷ prior year’s Op Inc) – 1] |
(22.45%) |
17.4% |
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What is the dollar amount of Net Income? |
57,651 |
80,600 |
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Compute the % change in Net Income = [(most recent year’s Net Income ÷ prior year’s Net Income) – 1] |
(28.47) |
14.80% |
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What is reported as basic earnings per share (EPS)? (look it up – no need to calculate) |
1.31 |
1.63 |
What is your overall assessment of your Company’s performance? Refer to any of the above numbers or ratios in your brief summary.
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The overall assessment of Income statement indicates that the performance of the company in current year has down, when compared with the previous year. Revenue has decreases and therefore the expense ratio has increased. This resulted in the decrease in profits.
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Part 2C: The Statement of Cash Flows
Find your Company’s Statement of Cash Flows (SCF) and answer the questions below:
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What is the most recent year used for this analysis? |
2012 |
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How many years of comparative information are provided in the SCF? |
Three year |
Insert the amounts requested below. Check the math by summing to the cash balance at the end of the year. Verify that the ending cash balance reported in the SCF is the same amount reported on the balance sheet for the most recent year available.
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Insert numbers and compute ratios: |
Most recent year available |
1st Prior Year |
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Cash provided by operations |
136,730 |
124,260 |
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Cash from investing activities |
(81,516) |
(35,802) |
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Cash from financing activities |
(58,169) |
(87,641) |
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Change in cash (may be called “increase or decrease in cash & equivalents”) |
(2,955) |
817 |
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Cash & equivalents balance at beginning of the year |
11,424 |
10,607 |
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Cash & equivalents balance at year end |
8,469 |
11,424 |
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Does the balance in Cash & equivalents at fiscal year end in the SCF match the amount shown in the Balance Sheet? (Yes or No) |
yes |
yes |
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Compute Free Cash Flow (net cash provided by operations – capital expenditures – cash dividends) – see textbook p. 61 |
55,214 |
88458 |
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More Questions about the SCF |
Most recent year available |
1st Prior Year |
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Name the largest cash outflow and the largest cash inflow in the investing activities section of the SCF? |
Purchases of property and equipment
Proceeds from the sale of company-operated restaurants
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Purchases of property and equipment
Proceeds from the sale of company-operated restaurants
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Name the largest cash inflow and the largest cash outflow in the financing activities section of the SCF? |
Borrowings on revolving credit facilities
Repayments of borrowings on revolving credit facilities
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Borrowings on revolving credit facilities
Repayments of borrowings on revolving credit facilities
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Part 2D: Financial Statement Analysis -- Common-Size Income Statements
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Fiscal Year |
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2012 |
2011 |
2010 |
2012 |
2011 |
2010 |
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Revenues: |
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Company restaurant sales |
12,19,214 |
13,80,273 |
16,68,527 |
78.91% |
83.03% |
87.84% |
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Franchise revenues |
3,25,812 |
2,82,066 |
2,31,027 |
21.09% |
16.97% |
12.16% |
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Total revenues |
15,45,026 |
16,62,339 |
18,99,554 |
100.00% |
100.00% |
100.00% |
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Operating costs and expenses, net: |
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Company restaurant costs: |
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Food and packaging (1) |
4,00,012 |
4,60,790 |
5,30,613 |
25.89% |
27.72% |
27.93% |
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Payroll and employee benefits (1) |
3,54,141 |
4,14,463 |
5,05,138 |
22.92% |
24.93% |
26.59% |
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Occupancy and other (1) |
2,81,516 |
3,29,766 |
3,98,066 |
18.22% |
19.84% |
20.96% |
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Total company restaurant costs (1) |
10,35,669 |
12,05,019 |
14,33,817 |
67.03% |
72.49% |
75.48% |
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Franchise costs (1) |
1,66,078 |
1,36,148 |
1,04,845 |
10.75% |
8.19% |
5.52% |
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Selling, general and administrative expenses |
2,27,003 |
2,24,653 |
2,43,453 |
14.69% |
13.51% |
12.82% |
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Impairment and other charges, net |
32,932 |
12,583 |
48,864 |
2.13% |
0.76% |
2.57% |
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Gains on the sale of company-operated restaurants |
-29,145 |
-61,125 |
-54,988 |
-1.89% |
-3.68% |
-2.89% |
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Earnings from operations |
1,12,489 |
1,45,061 |
1,23,563 |
7.28% |
8.73% |
6.50% |
What do you observe from the common-size analysis of your company?
The sales revenue of Franchise has shown increasing trend, while the resultant sales has shown decreasing trend.
The expenses has not been as per the increase / decrease of revenues. Hence the earnings from operations has shown changes in relation to revenue.
Part 2E: Insert your company’s financial statements here – this should fit on 4 or 5 pages
Include copies of the following financial statements from the Company’s 10-K – not abbreviated versions from Finance Yahoo or Google Finance:
· Balance sheet (may be on two pages)
· Income statement
· Statement of Cash Flows
· Statement of Changes in Stockholders’ Equity
All four statement are attached in Annual report
Part 3: Discussion of a news article about the Company
Insert your first article discussion for this company here – this should fit on one page. (You will submit a second article discussion for this company with your final project.) Please use a news article rather than an opinion piece from a blog such as Seeking Alpha.
Description of Article discussion
Include one article summary for each company in the group (for a total of four or six article summaries depending upon how many members are in your group). The articles should be dated no earlier than June 1, 2013. Summarize the article and its impact on your company or the industry (and perhaps the company’s stock price). Each article summary should include the following (at a minimum):
Citation: Title of article, author, source (e.g., WSJ, 7/29/13, p. B4), and link to article if possible
How: How does the article relate to the Company or to the industry?
Why: Your discussion of the article should highlight key points that relate to the company or the industry and hopefully to accounting
Effect: For example, did the stock price change after the event(s) described in the article?
Do NOT copy and paste from the article. Use you own words.
Part 4: Tracking your Company’s stock price
You are tracking your company’s stock price from 9/24/13 through 12/3/13. Thus, this first submission will only include a partially completed worksheet, e.g., you do not “sell” your stock. [Please insert your Stock Monitoring Worksheet here – this should fit on one page. See Blackboard for the actual Excel template.]
