Required (2 items x 50 points):

1. Respond to Shayne's criticism that shareholders' equity does not represent the market value of the
company. What information does the statement of financial position provide?

The book value of Shareholders' Equity is the amount the Company would be worth if it were liquidated
on December 31, 2x15. This means that if the Company's assets are sold and its liabilities are paid in full,
the shareholders will get an amount equal to the difference. Movement in she is determined by what is
going on in the Company's books (from earning profits, incurring losses, declaring dividends to additional
capital investments).

Market value, on the other hand, is the amount that investors are ready to pay for the company. It is just
the stock market value of the company. Traders, investors, and dealers communicate with one another in
the market. They must agree on the same price for a deal to take place. Unlike book value, market value
fluctuates. Changes in the economy, political events, environmental changes, poor PR, or anything else
that has a significant impact on investment decisions can all affect it.

Finally, the Statement of Financial Position (SFP) or balance sheet, as the name implies, shows the
financial health of the company. It shows the Company's assets, liabilities, and ownership. Here's a quick
rundown of what the balance sheet shows:

Assets are the resources that are used to create revenue and meet obligations.

Liabilities - These are the debts that the Company owes to other entities, which may have been incurred
to fund operations or something similar.

The term "shareholder's equity" refers to the percentage of a company's stock that is owned by its
shareholders.

2. The usefulness of the balance sheet is enhanced by classifying assets and liabilities according to
common characteristics. What are the classifications used in Under Armour's statement of financial
position, and what do those categories include?
On the basis of the term life of assets and liabilities, classifications are created based on current and non-
current components. Armour's assets and liabilities were divided into two categories: current and non-
current. Current assets are assets that can be quickly turned into cash within a year or during the
operational cycle. Noncurrent assets are ones that must be converted into cash over time. These are
long-term investments that are difficult to realize. Payables due immediately or within a year are
referred to as current liabilities. These are currently maturing responsibilities, most of which are tied to
operations. Long-term loans and debentures that are not due to mature in the next year are examples of
noncurrent liabilities.

1. Respond to Shayne's criticism that shareholders' equity does not represent the market value of the
company. What information does the statement of financial position provide?

The amount the company would be worth on December 31, 2x15 if it were to be
liquidated is its net worth of shareholders' equity. Therefore, the shareholders would receive the
difference if the Company's assets were sold and its debts were fully settled. The company's
financial activity, including revenues, losses, dividend declarations, and new capital investments,
determines how she moves. On the other side, market value is the price that investors are
willing to pay for the business. It is basically the company's stock market worth. In the market,
dealers, traders, and investors converse with one another. A contract cannot be made unless
they both agree on the same price. Market value changes in contrast with record value. It can be
impacted by changes in the economy, political events, environmental changes, bad public
relations, or anything else that has a big impact on investment decisions.

The Statement of Financial Position (SFP), sometimes known as the balance sheet or
income statement, displays the company's financial standing. It displays the assets, liabilities,
and ownership of the Company. The balance sheet shows the following in its simplest form. The
resources utilized to generate income and comply with commitments are known as assets.
Moreover, Liabilities are the money owed by the Company to other people or companies. These
debts may have been incurred to pay for operations or perhaps something else. And lastly, the
amount of a company's shares held by its shareholders is referred to as "shareholder's equity"
(SE).

2. The usefulness of the balance sheet is enhanced by classifying assets and liabilities according to
common characteristics. What are the classifications used in Under Armour's statement of financial
position, and what do those categories include?

Classifications are developed based on current and non-current parts according to the term period of
assets and liabilities. The current and non-current categories of Armour's assets and liabilities were
separated. Current assets are those that can be quickly converted into cash within a year or while the
business is operating. Assets that must be turned into cash over time are referred to as noncurrent
assets. These are challenging to achieve long-term investments. Current liabilities are accounts
receivable that are due today or within the next year. These are developing responsibilities, and most of
these are related to operations. Noncurrent Liabilities include long-term loans and debts that aren't
expected to maturity for another year.