Solution
Insha answered on
Feb 12 2022
Running Head: PASTE YOUR TITLE OF ASSIGNMENT HERE 1
ACCOUNTING 3
ACCOUNTING
JOHNSON AND JOHNSON
Table of Contents
Introduction 3
Company Background 3
Income Statement 3
Balance Sheet 4
Statement of Cash Flows 5
Critical Audit Matters 5
Conclusion 6
References 7
Introduction
This paper investigated SEC 10k report of Johnson & Johnson. In this report it will be analyzed the Accounts Receivable and Inventory of the company, for instance, Critical Audit Matters, Statement of Cash Flows, Income Statement and Balance Sheet. This paper will also compare prior year statements, cu
ent year statements and the aspects, which changed. Lastly, it will be concluded by summarizing the closing of the company.
Company Background
Johnson & Johnson (J&J) is an American multinational firm that produces consumer packaged products, medical equipment and medicines. It was founded in 1886. In November 2021, the firm announced that it would split into two publicly listed companies, one focusing on consumer goods and the other on medicines. There are around 250 subsidiary firms in the corporation, with activities in 60 countries and products marketed in over 175 countries. In the calendar year 2020, Johnson & Johnson had global sales of $82.6 billion (Livingston, Malani & Creech, 2021).
Income Statement
“The income statement is a financial statement that shows the financial outcomes of a company's business operations over time. The income statement shows how much money a firm made over a certain time and how much it cost to make that revenue.” (Investor, 2020) From 2018 to 2019 and from 2019 to 2020, Johnson & Johnson's client sales grew. Operating earnings at Johnson & Johnson grew from 2018 to 2018, but then fell dramatically from 2019 to 2020 (Investor, 2020).
In addition, earnings before allowance for income taxes and net earnings fell (Investor, 2020). When the Company fulfils its commitments under the terms of a contract with a client, revenue is recognized. Discounts, product returns, coupons, trade promotions, sales incentives and Provisions for rebates to consumers are reported as a reduction in sales and accounted for as variable consideration.
The pharmaceutical goods company's sale within the United States accounts for a large share of the rebate liabilities. Allowances for...