Apple Inc. was founded in 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne. The company introduced its first product, Apple 1, into the market in July 1976. Being sold as a motherboard, Apple 1 was valued at $ 666.66, which is about $ 3005.92 according to the present-day dollar valuation.
Difference between Apple Corporate Income Statement and Partnership Income Statement
Before becoming a corporation, Apple started as a partnership between the three co-founders. Ideally, the income statement of a partnership should be the same aside from a few differences. The primary difference between accounting for partnership and accounting for a corporation is that earnings and losses in a partnership are allocated to each partner (“Major Difference Of The Financial Statement between Partnership And Limited Company”, 2006). Before Apple Inc. changed into a corporation, its income statement showed how the net profit was distributed to its three partners. However, currently, the company’s income statement shows a statement of change in equity where changes in share capital, profit, revenue during the year are displayed(“Major Difference Of The Financial Statement between Partnership And Limited Company”, 2006). Besides, as a partnership, the three partners were taxed on an individual basis. However, a public corporation, Apple Inc., pays tax a separate legal entity. Therefore, the presentation of the income tax expenses for a corporate income statement is different from that of a partnership.
Delegate your assignment to our experts and they will do the rest.
Comparison between Apple’s Balance and a Partnership Balance Sheet
Irrespective of whether a balance sheet is for a partnership or a corporation, it is made up of three sections: assets, liabilities, and equity. The assets and liabilities sections are more or less the same for both a partnership and corporation balance sheets (Merritt, 2019). However, the presentation in the equity section is quite different due to the difference in the ownership structure of the two business structures. Apple’s equity section is made up of two sections: contributed capital and retained earnings. The contributed capital is the fund the company received as a result of selling its stock. The retained earnings, on the other hand, represents the company’s accumulated profits since it was founded minus the dividends distributed among the shareholders (Merritt, 2019). The equity section of the corporate balance sheet also shows the total number of outstanding shares.
Unlike the corporate balance sheet, the equity section of a partnership balance sheet is divided into entries depending on the number of partners. Each partner has his own entry in the balance sheet. Each partner is allocated a capital account and a current account. The capital account discloses the initial investment in addition to any subsequent contribution by the partner (Merritt, 2019). The current account, on the other hand, discloses the business’s profits as distributed among the partners. Unlike a corporate balance sheet, as in the case of Apple Inc., the equity section of a partnership balance sheet incorporates drawings by the partners.
Comparative Analysis between Apple and Google
Apple Computer Company was founded in 1976, but it was until January 3, 1977, that Apple Computer, Inc. was incorporated. Larry Page and Sergey Brin came up with the idea for Google in January 1996 while at Stanford University. It was, however, until September 1998 that Google was incorporated (Hosch & Hall, 2019).
Due to rapid growth, Google opted to go public, making an initial public offering in 2004. Apple, on the other hand, went public on December 12, 1980, selling 4.6 million shares and raising over $ 100 million. Currently, both companies are listed on the Nasdaq stock market. As of the year 2018, Apple’s total equity was $ 107.1 billion. However, in the last quarter, Apple had total equity of $ 96.5 billion. Google, on the other hand, had total equity of $ 177.6 billion in 2018. Alphabet (Google)’s total equity, for the second quarter of 2019 was $ 192,192 million.
References
Hosch, W., & Hall, M. (2019). Google Inc. | History & Facts. Retrieved 21 September 2019, from https://www.britannica.com/topic/Google-Inc
Merritt, C. (2019). Corporate Vs. Partnership Balance Sheets. Retrieved 21 September 2019, from https://smallbusiness.chron.com/corporate-vs-partnership-balance-sheets-41175.html
Major Difference Of The Financial Statement between Partnership And Limited Company - College Accounting Coach | College Accounting Coach. (2002). Retrieved 21 September 2019, from http://basiccollegeaccounting.com/2006/09/major-difference-of-the-financial-statement-between-partnership-and-limited-company/
