Swot Analysis of Apple Inc
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Added on 2020-12-29
Swot Analysis of Apple Inc
Added on 2020-12-29
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Accountancy andFinance
Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1a. Profile of the company and industry.......................................................................................1b. Calculation of ratios................................................................................................................2c. Interpretation of ratios.............................................................................................................4d. Strategic analysis of the company...........................................................................................6e. Advice to the investors............................................................................................................8CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10APPENDIX....................................................................................................................................11
INTRODUCTIONAccountancy is a process of recording, differentiating and controlling financial data indifferent books of an organisation. It helps the management of a company to get the exactinformation of company's performance and financial status. Finance is a form of monetaryresources, which is used to mobilise the funds in assets or liabilities of a business enterprise. Itcan be defined as management of wealth in which many activities are performed by accountantssuch as investing, lending, budgeting, borrowing and forecasting. The organisation which ischosen for this project report is Apple Inc, it is an American international technology company.Its headquarter is in, Cupertino, California (Johnson and et. al., 2012).This project report consist overview of chosen company, calculation of different ratioswith their interpretation, SWOT analysis of the organisation and in last advice to the investors toinvest or not to invest in that company.MAIN BODYa. Profile of the company and industryApple Inc is a multinational company, which is mainly based in Cupertino, California. Itdeals in consumer electronics, computer software and different online services. It producesdifferent products such as smart phones, personal computers, tablets, portable media player,smartwatch, digital media player etc. It also deals in different software that are IOS, iTunes,Safari which is a web browser etc. It was founded and developed by Steve Jobs, Steve Wozniakand Ronald Wayne in 1976 (Sutherland, 2012). In starting it had a huge success with personalcomputers but because of high prices the market of apple personal computers the demand getdecreased. Due to this problem Steve Wozinak stepped away from Apple and Steve Jobsresigned and started his own new company named, Next by bringing apple employees with him. When the demand of personal computers increased, the sales of Apple was totallydecreased because competitors are providing computers on lower prices. When apple was facingthis issue the CEO of Apple decided to buy Next to bring Steve Jobs back (Kang, 2013). Jobsregained leadership in a short time within company and became new CEO of Apple. Then he hasopened new retail stores, by acquiring different software companies. It results in huge successand increased the profitability. Now apple is world wide famous and demand of its differentproducts always remain on peak. The organisation enjoys brand loyalty of different companies. It1
has ranked worlds most valuable brand. It has faced different phases such as the peak in themarket and totally declined demand, but it has proved that it is the most demanding product inworld by establishing it self again, after facing so many challenges (Wonglimpiyarat, 2012).Economy of California is the largest economy in United States, as it is boostingcontinuously. It has ranked as the fifth largest economic system of world. The most governingfactors in California are agriculture, technology, trade, media and tourism. It is mainly concernedwith coastal cities and inner areas are related to agriculture. Contribution of Los Angeles and SanFrancisco helped the economy of US to grow faster, as one is related to tourism and another isrelated to technology. The economic system of US is highly developed and it is a kind of mixedeconomy. It the largest economy of world by GDP and second largest economy by purchasingpower parity. It has a highly varied, world primal commercial enterprise sector. It is a hightechnology innovator with second rank is world. The currency of US is Dollar. It is the mostused currency for international transactions and also the most reserved currency in the world.The economy of the country is growing with the help of different natural resources within US,developed infrastructure and higher level of productivity. Apple has a large contribution in theeconomy of US as it has a higher demand in market. The contribution of the company will bemore than $350 Billion to US economy, in next five years. In 2018 the estimated contribution ofApple is $55 billion (Contribution of Apple toward US economy, 2018). It has contributed 0.5%in GDP of US.b. Calculation of ratiosProfitability ratios:These ratios are calculated to analyse the ability of company to earnincome as compare to its expenses.Gross profit ratio: It is used to measure marginal profit and revenues of a company.Higher ratio shows the good profits which is good for the organisation.Formula: Gross profit / sales *100Net profit ratio: It is used to measure profitability of whole organisation by consideringindirect and direct costs of different products. Higher ratio shows the positive returns inthe company.Formula: Net profit / sales*100Profitability ratios20162017Sales215639229234Gross profit84263881862
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