| Course | MGMT 5003 Foundations of Business Management |
|---|---|
| Module | Module 3 |
| Paper type | Financial statement analysis |
| Length | 1,250 words, about 5 pages plus title and reference pages |
| Format | APA 7 student paper |
| School | American College of Education |
| Program | MBA |
| Updated | October 2026 |
Free sample paper for MGMT 5003 Module 3
$17.6 Billion in Sales, $714 Million Kept: Reading Casey's Fiscal 2026 Financial Statements
Student Name
American College of Education
MGMT5003: Foundations of Business Management
Module 3 Assignment
Instructor Name
June 21, 2027
Introduction
The first two papers in this course described how Casey's General Stores is managed and structured. This one turns to its money. As a chemistry teacher, I had never read a financial statement before this course, so this paper is written the way I learned to read them: one statement at a time, with each calculation shown. Every number below is taken from the fiscal 2026 Form 10-K, covering the twelve months through April 30, 2026, and is rounded to the nearest million dollars unless noted (Casey's General Stores, Inc., 2026). The paper reads the three statements in turn, earnings first, then the year-end position, then cash, calculates basic ratios and closes with what the numbers say about the business.
The Income Statement
The income statement shows what the company earned over the year. Casey's reported revenue of $17,561 million, up 10.2 percent from $15,941 million in fiscal 2025, partly because of a full year of stores acquired from Fikes Wholesale. The cost of goods sold, excluding depreciation, was $13,240 million, leaving $4,321 million, or about 24.6 percent of revenue. From that the company paid operating expenses of $2,837 million, mostly store wages and other store costs, depreciation and amortization of $450 million and net interest of $97 million. Income before taxes was $937 million, income taxes were $223 million and net income was $714 million, up from $547 million. Diluted earnings per share rose from $14.64 to $19.16.
Why the Margin Looks Thin
Net income was only about 4.1 percent of revenue, which seems small. The reason is fuel. Fuel produced $10,615 million of revenue, about 60 percent of the total, but kept only $1,497 million after its cost, about 14 percent. Prepared food and dispensed beverages produced only $1,777 million of revenue, about 10 percent of the total, but kept $1,041 million, about 59 percent. Grocery and general merchandise fell in between. Because fuel inflates revenue while adding relatively little profit per dollar, a convenience store's net margin will always look low beside a restaurant's or a software company's. Comparing profit with revenue is less useful here than comparing it with the money invested in the business.
The Balance Sheet
A balance sheet is a snapshot: on April 30, 2026, here is everything Casey's held and everything it had promised to pay. Total assets were $8,936 million, mostly stores, land and equipment. Total liabilities were $4,984 million, including long-term debt of $2,330 million plus $101 million due within a year. Shareholders' equity, the owners' stake, was $3,952 million, and assets equal liabilities plus equity, as they must. Current assets, those expected to turn into cash within a year, were $1,364 million, including $523 million of cash and $557 million of inventory. Current liabilities were $1,351 million. Debt rose sharply in fiscal 2025 to pay for the Fikes acquisition and fell slightly in fiscal 2026 as the company began paying it down.
Liquidity and Debt
Two simple ratios describe the balance sheet. Setting the $1,364 million due to turn into cash within a year against the $1,351 million falling due in the same window gives a current ratio of about 1.01. A ratio near one would worry me in many businesses, but a convenience chain sells its inventory quickly for cash and is paid immediately by guests, so it does not need a large cushion. Borrowing, measured as total debt of about $2,432 million divided by equity of $3,952 million, was about 0.62, meaning the company borrowed about 62 cents for every dollar the owners had invested. Interest was well covered: income before interest and taxes of about $1,034 million was roughly 10.7 times the $97 million of net interest.
Returns
Returns compare profit with the resources used to earn it. Dividing net income by the owners' stake averaged across the year gives return on equity: $714 million divided by about $3,730 million, or about 19.2 percent. Return on assets, net income divided by average total assets of about $8,572 million, was about 8.3 percent. These results are much stronger than the 4.1 percent net margin suggests, and they explain how a business with a thin margin per dollar of sales can be very profitable for its owners: it turns its assets over many times a year, selling large volumes of fuel and food from stores it already owns.
The Cash Flow Statement
Cash, not profit, is the subject of the third statement. Operating activities produced $1,378 million of cash, almost twice net income, mainly because depreciation is a non-cash expense. Over a single quarter or year, Dechow (1994) found reported profit to be the better yardstick, since accrual accounting irons out the lumpy timing of receipts and payments; she also showed that the distance between profit and cash deserves attention. Sloan (1996) found that earnings driven mainly by accruals tend to persist less than earnings backed by cash. Casey's earnings are well backed by cash. The company spent $656 million on property and equipment, leaving about $722 million of free cash flow, and used part of it to pay $83 million of dividends and buy back $201 million of its own shares.
Comparing Two Years
Setting fiscal 2026 beside fiscal 2025 shows the direction of travel. Revenue grew about 10 percent, but net income grew about 31 percent, from $547 million to $714 million, so more of each sales dollar became profit. Sales minus product costs rose from $3,752 million to $4,321 million, while operating expenses rose more slowly, from $2,552 million to $2,837 million. Operating cash flow climbed from $1,091 million to $1,378 million. Equity grew from $3,509 million to $3,952 million as profits were retained. The one line moving the other way was interest, which rose from $84 million to $97 million because of the debt taken on for the acquisition, a cost the company appears able to carry comfortably.
What the Statements Say Together
Read together, the three statements describe a company that grew through a large acquisition, borrowed to pay for it and is now generating enough cash to invest in stores, reduce debt and return money to shareholders at the same time. The income statement shows profit growing faster than revenue, mainly because food and fuel margins improved. The balance sheet shows moderate debt, not heavy borrowing. The cash flow statement confirms that the reported profit is real cash. The main risk visible in the numbers is dependence on fuel, a large but low-margin business exposed to price swings and, eventually, to electric vehicles.
Limits of This Reading
A first reading of three statements leaves much out. The notes to the financial statements explain accounting choices, leases and contingencies that I have not analyzed. One year of ratios says little without a longer trend or a comparison with competitors such as other large convenience chains. And the figures are rounded, which slightly changes some ratios. Even so, the exercise taught me how to move from a page of numbers to statements about a business.
Conclusion
Casey's earned $714 million on $17.6 billion of revenue in fiscal 2026. Its net margin is thin because fuel dominates revenue, but its return on equity of about 19 percent, solid interest coverage and strong operating cash flow describe a healthy, growing company. Learning to read the three statements together, and to ask why a ratio looks the way it does, is the skill this module set out to build.
References
Casey's General Stores, Inc. (2026). Form 10-K for the fiscal year ended April 30, 2026. U.S. Securities and Exchange Commission. https://www.sec.gov/Archives/edgar/data/726958/000072695826000046/casy-20260430.htm
Dechow, P. M. (1994). Accounting earnings and cash flows as measures of firm performance: The role of accounting accruals. Journal of Accounting and Economics, 18(1), 3-42. https://doi.org/10.1016/0165-4101(94)90016-7
Sloan, R. G. (1996). Do stock prices fully reflect information in accruals and cash flows about future earnings? The Accounting Review, 71(3), 289-315. https://doi.org/10.2308/tar-9608042309
The MGMT 5003 Module 3 assignment instructions
Module 3 of MGMT 5003 usually asks you to read the basic financial statements of a company and explain what they show. Expect to describe the statement of earnings, the statement of financial position and the cash statement in your own words and to identify the most important figures in each. Most prompts ask for a handful of ratios, such as margins, the current ratio, debt to equity and return on equity, with the calculations shown. Tie every ratio to the way this company earns money instead of quoting a textbook benchmark. Some sections ask for a comparison with the prior year or a competitor. Cite the company's filing and any research in APA. Show your inputs so the grader can follow each step.
How this MGMT 5003 Module 3 example is built
Each statement gets its own section in this sample, written for a reader new to accounting. The income statement section follows revenue down to net income and earnings per share. A separate section uses category figures to explain why fuel makes the margin look thin. The balance sheet section checks that assets equal liabilities plus equity and explains the acquisition debt. Liquidity, debt and coverage ratios are calculated with the inputs shown, followed by return on equity and assets. The cash flow section uses accounting research on accruals to judge earnings quality, and a closing section names the limits of a one-year reading.
Where the points sit in the MGMT 5003 Module 3 rubric
Financial statement papers are graded on accuracy, explanation and interpretation. Faculty check that figures are taken correctly from the statements and that each ratio is calculated properly with the inputs visible. More weight goes to interpretation: explaining what a ratio means for this company, why it looks high or low and how the statements relate to one another. A prior-year comparison and attention to cash flow quality show depth. Papers that list numbers without explanation, misread a line item or apply general rules of thumb without considering the business model tend to lose marks. Accurate citation of the filing in APA 7 is part of the grade.
MGMT 5003 Module 3 help from the desk
Reading financial statements for the first time can be daunting, especially if your background is in teaching, health care or engineering. If you are unsure where to find a company's statements, which ratios to calculate or how to explain what they mean, we can help. Tell us the company you want to analyze and share the assignment, and a writer will draft a plain-language reading of all three statements with each calculation shown and interpreted for that business. Retailers, manufacturers, hospital systems and technology firms all work well, and we work from the latest filing. Statement analyses with full calculations are generally completed in about two days.
Write yours, or have the desk draft it
This paper is an original model document written by our desk, not a submitted student paper and not an official American College of Education document. Read it for the moves, then write your own to the instructions in your classroom. If you want one built to your exact prompt and rubric, the first custom sample is free and arrives in 24 to 48 hours.
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MGMT 5003 Module 3 questions, answered
What does MGMT5003 Module 3 usually ask for?
The third MGMT5003 module usually has you read a company's basic financial statements, calculate a few key ratios and explain in plain language what they show about the business.
What are the three main financial statements?
The income statement shows revenue, expenses and profit over a period; the balance sheet shows assets, liabilities and equity at a date; the cash flow statement shows cash in and out.
Which financial ratios should a beginner calculate?
Gross and net margin, the current ratio, debt to equity, interest coverage, return on equity and return on assets give a balanced first view of profit, liquidity, debt load and returns.
Where can I find a free MGMT 5003 Module 3 sample paper?
Here, in full: a plain-language reading of Casey's fiscal 2026 statements, with a 4.1 percent net margin, a 1.01 current ratio, debt at 0.62 of equity and a 19.2 percent return on equity.
Why is a convenience store's profit margin so low?
Fuel makes up most of revenue but keeps only a small share after its cost, so total margins look thin even when returns on the money invested are strong.