Companies' financial statements.
Select 2 companies in the same industry (for example, the home improvement industry or the candy industry).
Use the Internet to find the companies' financial statements.
From the financial statements, list the different components from the Stockholder's Equity section.
Read the footnotes to the financial statements to see what they disclose about their Stockholder's Equity section.
Which parts do they have in common?
Is there anything about their Stockholder's Equity that is distinctive to the business?
Share with the class what you have found.
Company 1: Lowe's Companies, Inc.
Company 2: The Home Depot, Inc.
Stockholders' Equity
- Common Stock: Represents the ownership interest of the company's stockholders.
- Retained Earnings: Represents the cumulative earnings of the company that have not been paid out to stockholders as dividends.
- Treasury Stock: Represents shares of the company's own stock that have been repurchased by the company.
- Accumulated Other Comprehensive Income: Represents a variety of other items that affect stockholders' equity, such as foreign currency translation gains and losses, unrealized gains and losses on investments, and changes in the value of equity securities.
- Lowe's has a larger amount of retained earnings than The Home Depot. This is likely because Lowe's has been in business for a longer period of time and has generated more earnings over the years.
- The Home Depot has a larger amount of treasury stock than Lowe's. This is likely because The Home Depot has repurchased more of its own stock than Lowe's.
- Lowe's has a higher amount of accumulated other comprehensive income than The Home Depot. This is likely because Lowe's has experienced more foreign currency translation gains and losses, unrealized gains and losses on investments, and changes in the value of equity securities than The Home Depot.