Accounting Case Study on General MillsFinancial Accounting Case Study Module 1: A. Consolidated Income Statements of General Mills: 1. The sale amount recorded by almost $8 billion is not the actual amount of cash collected. The $8 billion figure includes cash and credit sales.2. Sales increased every year from 2000 to 2002. The difference between 2000 and 2001 was an increase of 5.35% (5,450-5,173/5,173 = 0.0535). The difference between 2001 and 2002 was an increase of 45.85% (7,949-5,450/5,450 = 0.4585).3. The largest expense for General Mills for the years 2000, 2001 and 2002 was the same; more than 50% of annual revenue was spent on cost of sales. Sales in 2002 were the highest, about 7% more than the previous two years. 0.599 = 59.9% 4. Net income: 2000: $614 million 2001: $665 million 2002: $458 million Comparing the net income figures for the last three years, we see that between 2000 and 2001, net income increased by $51 million. , but between 2001 and 2002, net income decreased by $207 million.5 A company's stock price is usually influenced by the amount of net income, because to find the stock price, you need to divide the number of shares by net profit. Thus, the higher the net income, the lower the stock price, which is what buyers are looking for (which means a better profit).6 Although General Mills paid dividends in 2000, 2001 and 2002, the total corresponding dividends have not been paid. appear as an expense in the income statement because dividends are not an expense; they constitute a financing activity which is recognized in the statement of equity. These are payments made only to the owners of the business.B. General Mills Consolidated Balance Sheets: 7. A company has assets that allow it to have a location and the equipment necessary to operate/start a business. Assets are resources controlled by a company. Without assets, you cannot produce and/or run a business. The purpose of assets is to track expenses, what a business owns, such as equipment, inventory, cash, etc., and create value for the business.8. Total assets at the end of 2002 were $16,540 million.9. Comparing assets from the beginning to the end of 2002, we found that the percentage increase in assets was 224.