Apple 2006 Annual Report Download - page 91

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 2—Restatement of Consolidated Financial Statements (Continued)
The following table presents the effects of the stock-based compensation and related tax adjustments made to the Company’s previously
reported consolidated statements of operations (in millions, except share and per share amounts):
(1)
Includes stock-based compensation expense, which was allocated as follows:
90
Fiscal Year Ended September 24, 2005
Fiscal Year Ended September 25, 2004
As
Reported
Adjustments
As
Restated
As
Reported
Adjustments
As
Restated
Net sales
$
13,931
$
—
$
13,931
$
8,279
$
—
$
8,279
Cost of sales (1)
9,888
1
9,889
6,020
2
6,022
Gross margin
4,043
(1
)
4,042
2,259
(2
)
2,257
Operating expenses:
Research and development (1)
534
1
535
489
2
491
Selling, general, and administrative
(1)
1,859
5
1,864
1,421
9
1,430
Restructuring costs
—
—
—
23
—
23
Total operating expenses
2,393
6
2,399
1,933
11
1,944
Operating income
1,650
(7
)
1,643
326
(13
)
313
Other income and expense
165
—
165
57
—
57
Income before provision for
income taxes
1,815
(7
)
1,808
383
(13
)
370
Provision for income taxes
480
—
480
107
(3
)
104
Net income
$
1,335
$
(7
)
$
1,328
$
276
$
(10
)
$
266
Earnings per common share:
Basic
$
1.65
$
(0.01
)
$
1.64
$
0.37
$
(0.01
)
$
0.36
Diluted
$
1.56
$
(0.01
)
$
1.55
$
0.36
$
(0.02
)
$
0.34
Shares used in computing earnings per
share (in thousands):
Basic
808,439
—
808,439
743,180
—
743,180
Diluted
856,780
98
856,878
774,622
154
774,776
Cost of sales
$
2
$
1
$
3
$
1
$
2
$
3
Research and development
$
6
$
1
$
7
$
4
$
2
$
6
Selling, general, and
administrative
$
34
$
5
$
39
$
28
$
9
$
37