1. Kodak Inc. Yang Wang ACG2021.002

2. Executive Summary Eastman Kodak Company ranks as a premier multinational corporation, with a brand recognized in virtually every country around the world. http://www.kodak.com/US/en/corp/annualReport 04/cover.shtml

3. Introduction CEO: Daniel A. Carp Home Office:343 State Street Rochester, NY Ending date of latest fiscal year : Dec. 31 Products and Services: Kodak is known not only for photography, but also for images used in a variety of leisure, medical, business, entertainment and scientific applications. Areas of Business: Kodak markets imaging products, systems and services in nearly every country around the world. Manufacturing operations are in the U.S., Canada, Mexico, Brazil, U.K., France, Germany, China, Japan, India, and Russia.

4. Audit Report Name of the company ’ s independent auditors: PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP The independent auditors stated that all financial statement of Eastman Kodak Company has completed with the standards of the Public Company Accounting Oversight Board. They have to examine all the statements, and they have pointed out that all material weakness of Kodak company are control deficiency.

5. Stock Market Information Most recent price of stock :$27.80 12 month trading range:$20.77-$34.97 Dividend per share:$.25 Date of the information: Dec 14,2004 In my opinion, it would be best for stockholders to hold their stocks because the current price of stock is lying in the median of 52 weeks trading range.

6. Industry Situation and Company plans The combined performance of Kodak businesses will make 2005 an historic crossover point in the company ’ s 125-year history. The digital sales should exceed Kodak Company ’ s traditional sales for the first time, and the growth in digital profits will exceed the profit decline in Kodak Company ’ s traditions businesses. The combined performance of Kodak businesses will make 2005 an historic crossover point in the company ’ s 125-year history. The digital sales should exceed Kodak Company ’ s traditional sales for the first time, and the growth in digital profits will exceed the profit decline in Kodak Company ’ s traditions businesses. For the coming year, Kodak Company focuses on: For the coming year, Kodak Company focuses on: Drive digital revenue growth. Astutely manage their traditional businesses to stay ahead of market realities, and meet earning goals. Effectively control costs associated with every aspect of their business. Relentlessly control costs associated with every aspect of our business. Maintain excellence in delivering customer-centric innovations and imaging solutions with the industry ’ s highest quality and focused, as always, on ease of use.

7. Income Statement Eastman Kodak Company uses a Multi-step Income Statement. (In millions) 2004 2003 Gross Margin $3,969 $4,175 Operating Income 81 189 Net Income 556 253 Gross Margin decreased and Operating Income, and Net Income increased from 2003 to 2004.

8. Balance Sheet (In millions) Assets = Liabilities + Stockholders Equity 2004: $14,737= 10.926 + 3,811 2003: $14,846= 11,601 + 3,245

9. Statement of Cash Flows Cash flows from operations are more than net income for the past two years. The company is growing through investing activities, such as buying property, plant and equipment. The company ’ s primary source of financing is long-term debt. Overall, cash has increased over the past two years.

10. Accounting Policies The significant accounting policies revenue recognition : The Kodak Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price fixed or determinable, and collectibles is reasonably assured. Cash Equivalents: All highly liquid investments with remaining maturity of three months or less at date of purchase are considered to be cash equivalents. Inventories : The Kodak Company provides inventory reserves for excess, obsolete or slow-moving inventory based on changes in customer demand, technology developments or other economic factors. property : properties are recorded at cost, net of accumulated depreciation. The Kodak Company principally calculates depreciation expense using the straight-line method over the assets estimated useful lives.

11. Accounting Policies The topics of the notes to the financial statements Significant Accounting polices and Restatement Significant Accounting polices and Restatement Receivables, Net Receivables, Net Inventories, Net Inventories, Net Property, Plant and Equipment, Net Property, Plant and Equipment, Net Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets Other Long-Term Assets Other Long-Term Assets Investments Investments Accounts Payable and Other Current liabilities Accounts Payable and Other Current liabilities Short-Term Borrowings and Long- Term Debt Short-Term Borrowings and Long- Term Debt Other Long-Term Liabilities Other Long-Term Liabilities Commitments and Contingencies Commitments and Contingencies Guarantees Guarantees Financial Instruments Financial Instruments Other Income Charges), net Other Income Charges), net Income Taxes Income Taxes Restructuring Costs and Other Restructuring Costs and Other Retirement Plan Retirement Plan Other Postretirement Benefits Other Postretirement Benefits Accumulated Other Comprehensive Loss) Income Accumulated Other Comprehensive Loss) Income Stock Option and Compensation Plans Stock Option and Compensation Plans Acquisitions Acquisitions Discontinued Operations Discontinued Operations Segment Information Segment Information Quarterly sales and Earning Data- Un-audited Quarterly sales and Earning Data- Un-audited Subsequent events Subsequent events

12. Financial Analysis Liquidity Ratios (In millions) 2004 2003 2004 2003 Working Capital $658 $197 Current Ratio 1.13 times 1.03 times Receivable turnover 5.33 times 5.09 times Average days ’ sales uncollected 68 days 72 days Inventory turnover 1.03 times 0.96 times Average days ’ inventory on hand 354 days 380 days

13. Financial Analysis Profitability Ratios 2004 2003 2004 2003 Profit Margin 4.11% 1.95% Asset Turnover 0.91 times 0.87 times Return on Asset 0.037 times 0.017 times Return on Equity 0.15 times 0.07 times

14. Financial Analysis Solvency Ratio Debt to Equity Debt to Equity 2003: 2.86times 2004: 3.57times

15. Financial Analysis Market Strength Ratios 2004 2003 Price/earnings per share 14.32times 31.59times Dividend yield 1.79% 4.13%