Fin4460: Quiz 3

Due Feb 10,2021

Instructions: All questions are based on GameStop’s 2019 annual report.

(https://news.gamestop.com/financial-information/annual-reports ). (4 Questions worth 20
points in total)
1) List 4 financial statements that are included in the annual report. (2 points)

2) Examine the Consolidated balance sheet (page F-3) (2 points)

a) What are the two main parts of the balance sheet?
b) Give at least one cause for concern from each part that MAY imply that the firm is
under distress. Give a brief justification for your choice.

3) Examine the Statement of Operations (Income Statement) (page F-4 (4 points) )

a) Give a brief description of structure of the first portion of the Income Statement.
(Ans: Like all income statements, it starts with revenue then subtracts various costs
such as taxes , and reports at the end the residual the net income (or loss).
b) Note at least TWO causes of concern from the 2019 statement.

4) Examine the Consolidated statements of cash flow (page F-7) ( 12 points)

a) What are the three main parts of the statement of cash flow presented?
b) What phase of product life cycle do you think GameStop is in? (Recall from class the
phases are Introduction, Growth, Mature and Decline) Give a brief justification.
c) Give a plausible reason how in 2018 GameStop had loss in income but had positive
cash flow from operations.
d) Give at least 3 causes for concern from the 2019 Fiscal year cash flow statement.