Review Microsofts organization's most recent 2-3 years financial reports (balance sheet, statements of cash flow, managements comments, and footnotes to the financial statements) to explain how each of the current asset and liability accounts have affected the cash management strategies. Please provide references. Thank you!
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Working capital strategies: Microsoft Inc.
For the fiscal year 2006, cash flow from operations decreased by 13% to $14.40 billion. This happened mainly due to increased payments to fund a $987 million increase in inventory & product costs associated with Xbox 360. However, these factors were negotiated with the help of increased cash receipts from customers, as a result of 11% revenue growth and $1.74 billion increase in the unearned revenue.
The organization does not have any significant long-term debt. It would also continue to make investments in marketing, sales, infrastructure for product support and present as well as the potential areas of technology. At the same time, addition to property & equipment will continue, including the development of new facilities and computers systems for purposes such as R & D, sales & marketing, support and administrative staff. In the fiscal year 2005, the net cash generated as a result of investing amounted to $15.03 billion. This happened in order to fund the cash dividends paid in the fiscal year 2005.
Residual value guarantees for various operating leases have been issued. It is also ...
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