Summary Week 5 assignment.docx (2) Intel Annual Report Evaluation 1 ACC208 Intel Annual Report Evaluation The University of Arizona Global Campus ACC208 Accounting for Managers Intel Annual Report Evaluation Part 1: Calculate Ratios Incorporated
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Week 5 (2) Intel Annual Report Evaluation 1 ACC208 Intel Annual Report Evaluation The University of Arizona Global Campus ACC208 Accounting for Managers Intel Annual Report Evaluation Part 1: Calculate Ratios Incorporated in 1968, Intel Corporation (Intel) is an American-based se...
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Intel Annual Report Evaluation 1
ACC208
Intel Annual Report Evaluation
The University of Arizona Global Campus
ACC208 Accounting for Managers
Intel Annual Report Evaluation
Part 1: Calculate Ratios
Incorporated in 1968, Intel Corporation (Intel) is an American-based semiconductor
manufacturer specializing in computer microchips headquartered in Santa Clara, California. The
founders Robert Noyce and Gordon Moore named Intel off the terms "integrated electronics."
Intel opened its doors with $2.5 million in funding arranged by Arthur Rock, the American
financier who coined the term venture capitalist (Hall 2021). Based on their financial health as of
2013, Intel is considered one of the most valued technology companies. With the world
continuing to transition to more of a digital platform, companies like Intel who specialize in
computer ships and technology, are thriving. You will see semiconductor chips in devices
like smartphones, tablets, and throughout a variety of segments such as automotive and
industrial, and laboratory settings. Semiconductors are now very common in household items
such as televisions and appliances such as smart refrigerators. This paper will take a closer
look at the ratios that help identify strengths and weaknesses of the company; liquidity,
leverage, and profitability. Throughout 2013 Intel delivered revenues of $52.7 billion with a
net income of $9.6 billion and earnings per share of $1.89.
, Liquidity
Intel has approximately $92 billion in total assets, which is $8 billion more than 2012,
demonstrating solid growth. Using the Liquidity Ratio, the formula of $32,084 in total Current
Assets, divided by $13,568 billion in Current Liabilities, resulting in a Liquid Ratio of 2.36 as of
the end of Fiscal Year 2013. Since many factors play into liquidity, Intel may be making more
money but have it invested in less accessible conditions causing a decline in their liquidity ratio.
In 2013 Intel went from 2.36 from 2.43 in 2012. When taking liquidity into consideration, the
quick ratio is often utilized. "The cash flow liquidity ratio uses in the numerator, as an
approximation of cash resources, cash and marketable securities, which are truly current liquid
assets" (Fraser & Ormiston, 2016, section 5.3). In other words, "the quick ratio measures a
company's ability to meet its short-term obligations with its most liquid assets and therefore
excludes inventories from its current assets" (Hayes 2021 Para. 6).
Leverage
Arkan discusses Financial ratios as the numerical value created from two or more values
taken from a company's financial statements i.e. its balance sheet, income statement or statement
of cash flow (p.3 para. 4). Leverage ratios are the debt to equity ratio as well as the debt to asset
ratio. Considering the debt to equity ratio will measure the extent of a company's debt that has
been financed against shareholders' equity. The total long term debt divided by the long-term
holders' equity will provide the debt to equity ratio. Intel has been steadily increasing its long-
term debt from 2010 through 2013, while equity remains relatively similar annually. Using too
little debt financing could sacrifice returns that could be realized through leverage (Fabozzi,
2020). The fiscal Year 2013 Total Debt was $13,189 million, and FY 2012's Total Debt was
$13,184 million, while in 2011, the total debt was only $7,084 million. Adding both the long and
short-term debt give a total of $$13,189 million, then divide that by the shareholders' equity of
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