Decision Case 11-1 Comparing Two Companies in the Same Industry: Kellogg's and General MillsRefer to the Stockholders' Equity Section of the balance sheets of Kellogg's as of December 31, 2010, and General Mills as of May 30, 2010.RequiredFor each company, what are the numbers of shares of common stock authorized, issued, and outstanding as of the balance sheet date?Did the balance of the Retained Earnings account of each company increase or decrease dur- ing the year? What factors can affect the Retained Earnings balance?How does the total stockholders' equity of each company compare to that of the other company? Does the difference mean that one company's stock is more valuable than the other's? Explain your answer. Kellogg Company and SubsidiariesConsolidated Balance Sheet(milions, except share data)20102009Current assets$ 441,1901,056Cash and cash equivalents$ 334Accounts receivable, net1,093Inventories910Other current assets225221Total current assets2,9152,5583,1283,010Property, netGoodwill3,6283,643Other intangibles, net1,4561,458Other assets720531Total assets$11,847$11,200Current llabilitiesCurrent maturities ofi ong-term debt$ 9521Notes payableAccounts payable44441,1491,0391,0771,166Other current liabilitiesTotal current liabilities3,1842,2884.9084,835Long-term debtDeferred income taxes697425Pension liability265430Other liabilities639947Commitments and contingenciesEquityCommon stock, 5.25 par value, 1,000,000,000 shares authorizedIssued: 419,272,027 shares in 2010 and 419,058,168 shares in 2009105105Capital in excess of par valueRetained eamings4954726,1225,481Treasury stock at cost53,667,635 shares in 2010 and 37,678,215 shares in 2009Accumulated other comprehensive income (loss)(2,650)(1,820)(1,914)(1,966)Total Kellogg Company equityNoncontrolling interests2,158(4)2,272Total equityTotal liabilities and equity2,1542,275$11,847$11,200Refer to Notes to Consolidated Financial Statements. Appendix CExcerpts from General Mills's Form 10-K for the Fiscal Year Ended May 30, 2010 [2010)C-5Consolidated Balance SheetsGENERAL MILLS, INC. AND SUBSIDIARIES(In Millions, Except Par Value)May 30,2010May 31,2009ASSETSCurrent assets:Cash and cash equivalentsReceivablesInventoriesDeferred income taxesPrepaid expenNes and other current assets673.2 $1,041.61,344.042.7378.5749.8953,41,346.815.6469.3Total current assets3,480.03,534.9Land, huildings, and equipmentGoodwillOther intangible assetsOther assets3,127.76,592.83,715.0763.43,034.96,663.03,747.0895.0Total assets17,678.9 $17.874.8LIABILITIES AND EQUITYCurrent liabilities:Accounts payahleCurrent portion of long-term dehtNotes payahle%24849.5 $107.31,050.11.762 2803.4S08.5812.21.481.9Other current liahilitiesTotal current liabilities3,769.13,606.0Long-term debtDeferred income taxesOther liabilities5,268.5874.65,754.81,165.31.932.22,118.7Total liabilities12.030.912.458.3Stockholders' equity:Common stock, 754.6 shures issued. $0.10 par valueAdditional puid-in capitalRetained earningsCommon stock in treasury. at cost, shares of 98.1 and 98.6Accumulated other comprehensive loss75.51.307.18,122.4(2,615.21(1,486.9)75.51.212.17.235.6(2,473.1)(877,8)Total stockholders' equity5,402.95,172.3Noncontrolling interests245.1244.2Total equity5,648.05,416.5Total liabilities and cquity17.678.917.874.8See accompanying notes to consolidated financial statements,

Stockholders’ equity: It refers to the amount of capital that includes the amount of investment…

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Decision Case 11-1 Comparing Two Companies in the Same Industry: Kellogg's and General Mills

Refer to the Stockholders' Equity Section of the balance sheets of Kellogg's as of December 31, 2010, and General Mills as of May 30, 2010.

Required

For each company, what are the numbers of shares of common stock authorized, issued, and outstanding as of the balance sheet date?
Did the balance of the Retained Earnings account of each company increase or decrease dur- ing the year? What factors can affect the Retained Earnings balance?
How does the total stockholders' equity of each company compare to that of the other company? Does the difference mean that one company's stock is more valuable than the other's? Explain your answer.

Kellogg Company and Subsidiaries
Consolidated Balance Sheet
(milions, except share data)
2010
2009
Current assets
$ 44
1,190
1,056
Cash and cash equivalents
$ 334
Accounts receivable, net
1,093
Inventories
910
Other current assets
225
221
Total current assets
2,915
2,558
3,128
3,010
Property, net
Goodwill
3,628
3,643
Other intangibles, net
1,456
1,458
Other assets
720
531
Total assets
$11,847
$11,200
Current llabilities
Current maturities ofi ong-term debt
$ 952
1
Notes payable
Accounts payable
44
44
1,149
1,039
1,077
1,166
Other current liabilities
Total current liabilities
3,184
2,288
4.908
4,835
Long-term debt
Deferred income taxes
697
425
Pension liability
265
430
Other liabilities
639
947
Commitments and contingencies
Equity
Common stock, 5.25 par value, 1,000,000,000 shares authorized
Issued: 419,272,027 shares in 2010 and 419,058,168 shares in 2009
105
105
Capital in excess of par value
Retained eamings
495
472
6,122
5,481
Treasury stock at cost
53,667,635 shares in 2010 and 37,678,215 shares in 2009
Accumulated other comprehensive income (loss)
(2,650)
(1,820)
(1,914)
(1,966)
Total Kellogg Company equity
Noncontrolling interests
2,158
(4)
2,272
Total equity
Total liabilities and equity
2,154
2,275
$11,847
$11,200
Refer to Notes to Consolidated Financial Statements.

Appendix C
Excerpts from General Mills's Form 10-K for the Fiscal Year Ended May 30, 2010 [2010)
C-5
Consolidated Balance Sheets
GENERAL MILLS, INC. AND SUBSIDIARIES
(In Millions, Except Par Value)
May 30,
2010
May 31,
2009
ASSETS
Current assets:
Cash and cash equivalents
Receivables
Inventories
Deferred income taxes
Prepaid expenNes and other current assets
673.2 $
1,041.6
1,344.0
42.7
378.5
749.8
953,4
1,346.8
15.6
469.3
Total current assets
3,480.0
3,534.9
Land, huildings, and equipment
Goodwill
Other intangible assets
Other assets
3,127.7
6,592.8
3,715.0
763.4
3,034.9
6,663.0
3,747.0
895.0
Total assets
17,678.9 $
17.874.8
LIABILITIES AND EQUITY
Current liabilities:
Accounts payahle
Current portion of long-term deht
Notes payahle
%24
849.5 $
107.3
1,050.1
1.762 2
803.4
S08.5
812.2
1.481.9
Other current liahilities
Total current liabilities
3,769.1
3,606.0
Long-term debt
Deferred income taxes
Other liabilities
5,268.5
874.6
5,754.8
1,165.3
1.932.2
2,118.7
Total liabilities
12.030.9
12.458.3
Stockholders' equity:
Common stock, 754.6 shures issued. $0.10 par value
Additional puid-in capital
Retained earnings
Common stock in treasury. at cost, shares of 98.1 and 98.6
Accumulated other comprehensive loss
75.5
1.307.1
8,122.4
(2,615.21
(1,486.9)
75.5
1.212.1
7.235.6
(2,473.1)
(877,8)
Total stockholders' equity
5,402.9
5,172.3
Noncontrolling interests
245.1
244.2
Total equity
5,648.0
5,416.5
Total liabilities and cquity
17.678.9
17.874.8
See accompanying notes to consolidated financial statements,

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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