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Word Count: 796
While analyzing the financial statements of Costco for the years 1995-1999 we concluded that the years were successful in terms of revenue and earning Due to their success the company is able to provide low prices to individuals and businesses in almost 300 locations worldwide Since there is such a steady growth in most area Costco has been able to open 100 new stores within the last 5 years and only closed 28 in the process Although they have had a steady increase in assets and liabilities it is essential to Costco that for the last five years the assets increase outweighs the liability increase When we examined the asset section of the balance sheet we found a few numbers that popped out but nothing that was too devastating In looking at Accounts Receivable we noticed a vertical decrease of accounts receivable to assets But then we noticed from 1997 to 1998 Costcos Accounts Receivable account increased by 14 this shows that Costcos ability to collect on outstanding accounts has declined slightly Although we did notice a 63 increase in Other Current Assets account there is no information as to what actually goes into this account We believe this account may refer to office and store supplies for example company cars desk and other things of this nature The Merchandise Inventory account shows a fluctuation which is due to change in retail inventory accounting method In the US LIFO is primarily used where as in foreign countries FIFO is used Therefore if Costco had used FIFO on all merchandise inventories they would have had a increase of 16150 for both 1997 and 1998 and a 12150 increase for 1999 The steady increase in Land and Land Rights and Land Improvements as well as Building and Leaseholds accounts probably have to do with the purchasing and opening of new warehouses Overall total assets quadrupled from 97 to 409 within the last 5 years Although accounts
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