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ACCT 313 Intermediate Accounting I
Financial Statement Application #2
Inventories
The purpose of this assignment is to help you understand how the inventories concepts discussed in
Chapters 8 and 9 of the textbook apply in a real-world company. To complete this assignment, you will need to use Starbucks’ 2013 Annual Report (available on Blackboard).
Prepare type-written responses to the following questions. Include appropriate references to the Annual Report. The assignment will be graded on correctness and presentation. Hand-written work will not be accepted and late assignments will have five points automatically deducted.

1. What types of inventories does Starbucks have?
Coffee (Unroasted and Roasted), other merchandise (serveware and tea) held for sale, breakfast food, packaging and other supplies
Pg69, Notes 5 Inventories 2. of the end of fiscal 2013, what is the balance sheet carrying value (book value) of Starbucks’ inventories?
$1,111.2
Pg53, “Starbucks Corporation Consolidated Balance sheet”

3. Is this the same amount that Starbucks paid to its suppliers to purchase these inventories? Why or why not?
Pg15, “Product supply”
No. There were $882 million, comprised of $588 million under fixed-price contracts and an estimated $294 million under price-to-be-fixed contracts.The reason that there will be difference between the price that Starbucks paid to its suppliers and the value shows on balance sheet is $294 million price-to-be-fixed contract. According to the “Product Supply ” section of Starbucks report,
Price-to-be-fixed contracts are purchase commitments whereby the quality, quantity, delivery period, and other negotiated terms are agreed upon, but the date, and therefore the price, at which the base “C” coffee commodity price component will be fixed has not yet been established.
Therefore, the price was fluctuated till

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