Financial Statements and Cash Flow Management: Microsoft Corporation

Financial Statements and Cash Flow Management
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Financial Statements and Cash Flow Management
Business Selection
Microsoft Corporation is a multinational technology company that Paul Allen and Bill Gates established in 1975. The firm’s headquarters are in Redmond, Washington in the United States of America (USA). Microsoft offers an array of products and services to its consumers. The company is renowned for its Windows Operating System, Edge and Internet Explorer browsers, and Microsoft Office. Microsoft provides software, cloud-based solutions, platforms, consulting services, online advertising, video games, business solution applications, desktop, and software development tools. Moreover, it designs, manufactures, and sells computers, accessories, entertainment consoles, tablets, and gaming devices. For example, Microsoft offers Skype, OneNote, Azure, Xbox, Visual Studio, and Windows 365 among other multiple products and services (Microsoft.com, 2023). Microsoft is among the largest technology companies in the USA and globally. Consumers of the company’s products and services are different demographics from all over the world. For instance, young people use Xbox gaming consoles to play video games and personal computers for education and entertainment among other things.
Financial Statement Role
Financial statements are crucial to a business since they accurately determine the firm’s financial position and performance. For instance, they enable stakeholders to know the company’s expenses, debt, revenues, and profits. Financial statements facilitate proper strategic decision-making processes (Osadchy et al., 2018). A balance sheet portrays the firm’s financial position by showing the assets, liabilities, and equities. Assets are further classified into tangible and intangible. Potential investors are likely to analyze the balance sheet of a company they want to invest in before deciding whether it will be profitable or not. When it comes to the income statements, they depict expenses, losses, sales, and profits. The most significant thing about these financial statements is that they show what happ...