...Bulls Eye Analyst A Valuation of Target As of November 1, 2006 Kyle Barkel Kyle.Barkel@ttu.edu Jerry Boroff Jerryjboroff@hotmail.com Ryan Campbell Ryancampbell85@yahoo.com Peter Carini Peter.J.Carini@ttu.edu Leslie Mitchell Leslie.Mitchell@ttu.edu Camille Ricci Camille.N.Ricci@ttu.edu Table of Contents Executive Summary………………………………3 Business & Industry Analysis Company Overview……………………………………...…5 Five Forces Model ……………………………….….6 Competitive Analysis……………………………………...12 Industry Conclusion……………………………………….15 Accounting Analysis Key Accounting Policies………………………………….15 Accounting Flexibility…………………………………….17 Accounting Strategy……………………………………...19 Quality of Disclosure……………………………………..19 Screening Ratio Analysis…………………………..……21 Potential Red Flags……………………………..………..25 Undoing Accounting Distortions…………..………...26 Ratio Analysis and Forecast Financials Financial Ratio Analysis……………………….……….27 Time Series Analysis…………………………...……...28 Cross Sectional (Benchmark) Analysis…….……..32 Financial Statement Forecasting Method..……...47 Analysis and Forecasting Solutions………..……...49 Valuation Analysis Method of Comparables……………………………….50 Cost of Capital…………………………………………….51 Discounted Dividend Models………………………...53 Discounted Free Cash Flows………………………...54 Abnormal Earnings Growth Method……………….55 Discounted Residual Income Method….…………56 LR Average RI Perpetuity Method…………….…..57 Altman’s Z-score………………………………………...59 Enterprise Value/ EBITDA……………………………59 Appendixes Appendix...
Words: 31457 - Pages: 126
...Form 10-K 1 of 56 http://www.sec.gov/Archives/edgar/data/1046501/000104596903000752... 10-K 1 d10k.htm FORM 10-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) x Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended December 29, 2002 or ¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Transition Period From to . Commission file number 0-25721 BUCA, INC. (Exact name of registrant as specified in its charter) Minnesota 41-1802364 (State or other jurisdiction of incorporation or organization) (I.R.S. employer identification no.) 1300 Nicollet Mall, Suite 5003 Minneapolis, Minnesota 55403 (Address of principal executive offices) (Zip code) (612) 288-2382 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: common stock, par value $.01 per share. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨ Indicate by check mark if disclosure of delinquent filers pursuant...
Words: 26600 - Pages: 107
...Case 10-2 Eagle Impairment Loss Eagle Company (Eagle) is a manufacturing company with operations in Italy and Serbia. Eagle in Italy: In addition to other assets, Eagle owns and operates a commercial building in Italy that is carried at its cost less any accumulated depreciation and any accumulated impairment losses. The building represents a cash-generating unit (CGU) for which the following information is available as of December 31, 2010: Building 12/31/10 in thousands  Carrying amount  $1,100  Value in use   900  Fair market value less costs to sell 800  Fair market value  850  Undiscounted future cash flows 1,150  Eagle in Serbia: In Serbia, in 2008, Eagle acquired a smaller competing company and goodwill was allocated to the CGU shown below. Activities in Serbia represent the lowest level at which internal management monitors goodwill. At the end of 2008 and 2009, the value in use of the CGU including goodwill exceeded its carrying amount. Therefore the activities of Eagle in Serbia and the goodwill allocated to those activities were regarded as not impaired. However, at the end of 2010, the newly elected government passed legislation significantly restricting exports of Eagle’s main product. The information below relates to the CGU (which includes goodwill) of Eagle’s operations in Serbia before the impairment analysis is performed. For this case, assume the basis of segmentation for CGUs and reporting units (RU) is the same under...
Words: 1102 - Pages: 5
...Exercise 5–6 Requirement 1 July 1, 2013 Installment receivables ................................................... 300,000 Sales revenue .............................................................. 300,000 To record installment sale Cost of goods sold .......................................................... 120,000 Inventory..................................................................... 120,000 To record cost of installment sale Cash ................................................................................ Installment receivables ............................................... To record cash collection from installment sale July 1, 2014 Cash ................................................................................ Installment receivables ............................................... To record cash collection from installment sale 75,000 75,000 75,000 75,000 Solutions Manual, Vol.1, Chapter 5 © The McGraw-Hill Companies, Inc., 2013 5–1 Exercise 5–6 (continued) Requirement 2 July 1, 2013 Installment receivables ................................................... 300,000 Inventory ..................................................................... 120,000 Deferred gross profit ................................................... 180,000 To record installment sale Cash ................................................................................. Installment receivables ............................................... To record cash collection...
Words: 4310 - Pages: 18
...ACTG 350 Case#1 Group: Penghui You, Ketong Zhou, Mengying Zhang Date: Oct 25, 2015 Disclosures * Codification section 50-1 A description of the facts and circumstances leading up to the disposal and, if held for sale, the expected manner and timing of the disposal. If not separately reported on its income statement, the gain (loss) on the sale and the caption on the income statement that includes the gain (loss). * Codification section 50-5B The major classes of line items constituting pretax income (loss) of the discontinued operation. Either the total operating and investing cash flows of the disposal of the discontinued operation or the depreciation, amortization, capital expenditures, and significant operating and investing noncash items of the discontinued operation. Journal Entry Book Value=Net Assets-Net Liabilities=(80+200-30)-20=230 millions Fair Value=200 millions Since book value is greater than fair value, there needs to write down to fair value which is 30 millions. Dec.1 Loss on writedown of assets $30,000 Assets of TCH $30,000 Comparative consolidated financial statements for DHI | (All $ amounts in millions) | | | | Statement of financial position | | | | 2014 | 2013 | | Cash | 20 | 30 | | Inventory | 360 | 380 | | Deferred income tax asset | 15 | 10 | | Loss on write-down...
Words: 293 - Pages: 2
...Prof SB Salter 6815 Quiz 2 1. Which of the following is NOT a key assumption of cost-volume-profit? A. Costs may be fixed, variable, mixed or step. B. Production and sales are equal. C. Changes in total cost are strictly due to changes in activity. D. Total costs and revenues can be depicted with a straight line. 2. If production does not equal sales, A. it must adjust the CVP formulas for that fact if it wishes to use CVP. B. it cannot use CVP, as an assumption is violated. C. a CVP analysis will always indicate a breakeven point that cannot be reached. D. the conclusions it draws from a CVP analysis will not be as sound as they would be if production equaled sales. 3. Profit is indicated on a cost-volume-profit graph by A. the profit line. B. the horizontal difference between the revenue line and the cost line. C. the vertical difference between the revenue line and the cost line. D. the horizontal distance from the breakeven point. 4. What component of the profit equation should be set equal to zero to find the breakeven point? A. Total sales revenue B. Total variable costs C. Total fixed costs D. Profit 5. The break-even point is A. the point where zero contribution margin is earned. B. the point where zero profit is earned. C. the point where selling price just equals variable cost. D. equal to sales revenue less fixed costs. 6. The profit equation is A. Unit price Q - Unit variable costs Q - Total fixed costs = Profit B. Unit price...
Words: 2201 - Pages: 9
...ACTG 351 Columbia On-Line Networks Case Due: Wednesday, January 22 (at the beginning of class). Also, please be prepared to discuss the case and your solution in class on this date. Required: Refer to the current, relevant accounting guidance to answer the questions on page 2 of the case. Groups: For this case, you will work in groups of two to four students. I will let you pick your group if you prefer, but will assign you to a group otherwise. Please be sure to reference the applicable professional guidance listed below to support your positions. Your discussion should be typed, double-spaced (quoting guidance can be single spaced) and no more than 4 pages in length. Applicable Professional Pronouncements: ASC 605-25: Revenue Recognition: Multiple-Element Arrangements ASC 605-10-S99: SEC Materials (Inconsequential or Perfunctory) Instructions for accessing the FASB Codification database: 1. Go to http://aaahq.org/ascLogin.cfm 2. User ID: AAA52999 3. Password: BbJ5LMm 4. Click on link to FASB Accounting Standards Codification (from American Accounting Association webpage) 5. Search on 605-25 (or access via topical drop down menu) Columbia On-Line Networks TOPIC 1: Revenue Recognition In conjunction with interim audit procedures for our client, Columbia On-Line Networks (the Company), the Company’s controller provided the audit engagement team with the following information regarding a significant sales contract. MEMO To: From: ...
Words: 794 - Pages: 4
...buck should present the borrowing and payment activity related to its revolving line of credit as cash flows from financing activity. According to the 2301045, the definition of financing activities is that “ Financing activities include obtaining resources from owners and providing them with a return on, and a return of, their investment; receiving restricted resources that by donor stipulation must be used for longterm purposes; borrowing money and repaying amounts borrowed, or otherwise settling the obligation; and obtaining and paying for other resources obtained from creditors on longterm credit”( FASB Accounting Standard codification, 2301045). As it also mentioned in FASB Accounting Standard Codification 230104514 and 230104515, then, “Proceeds from issuing bonds, mortgages, notes, and from other shortor longterm borrowing” and “payments of dividends or other distributions to owners, including outlays to reacquire the entity's equity instruments” are cash flows for financing activities. Therefore, Buck should present the borrowing and payment activities related to its revolving line of credit as cash flow from financing activities. Part 2 In scenario 1 (net), all the borrowing and payment activities are based on net basis within the financing activities section of its statement of cash flows. As FASB ASC 23010459 indicates “amounts due on demand are considered to have maturities of three months or less.” Here the situation is all draws are considered...
Words: 811 - Pages: 4
...Question 3: Briefly discuss the key events that led up to the Sarbanes- Oxley Acts of 2002 and the Creation of the PCAOB. Answer 3: In the mid 1990s America experienced a flourishing economy. The stock market rate rose at increasing rates. This motivated accounting firms to desire to expand their business. In the 2000s there was a bubble burst, stock prices plummeted as investors fled the market. IPOs also disappeared and this event led to the revelation other flaws in the market. It became apparent that the boom years had been accompanied by fraud. Corporations such as Enron, WorldCom, Tyco and Adelphia had a lot of misconduct in business principles. There was lack of fairness and integrity due to conflict of interest. Corporations focused on short-term goals. A lot of managers adjusted financial result to meet the projected results. Question 5: Compare and contrast management’s responsibility for the entity’s financial statements with the auditor’s responsibilities for detecting errors and fraud in the financial statements. Answer5: Managements are responsible for presenting fair financial statements in conformity with general accepted accounting principles and auditors are confined to express his or her opinion on the information provided. Auditors are responsible to check if managers are conforming to GAAP with no errors and materiality. Management and auditors both have to conform to GAAP. Question 9: What kind of organization is PCAOB, why was it formed, and...
Words: 1047 - Pages: 5
...Course Outline ACTG 3120.3.0 : Intermediate Financial Accounting II Section: T Class: Tuesdays, 11:30am – 2:30pm Lab: Wednesdays, 5:30pm - 7:00pm Instructor Liz Farrell (416)736-5063 or (416)736-2100, ext. 66522 S345 Seymour Schulich Building efarrell@schulich.yorku.ca Office hours: Mondays, 8:00 - 8:30 am Tuesdays, 10:30 - 11:30 am Wednesdays, 8:00 - 8:30 am Secretary Filomena Petrilli 416-736-5063 S344K Seymour Schulich Building fpetrill@schulich.yorku.ca Brief Description This is an extension of SB/ACTG 3110.03, but with a primary focus on the valuation and presentation of liabilities and owners' equity. Major topics include current, long-term and contingent liabilities; leases; pensions; corporate income tax allocation; capital transactions, earnings per share and analysis of financial statements under differing accounting policies. The criteria by which both preparers and users make decisions are emphasized. Prerequisite[s] / Co-requisite[s] Note: Not available to exchange students visiting Schulich. Prerequisite: SB/ACTG 3110 3.00 Course objectives and detailed description The objective of this course is to provide students with an indepth understanding of the accounting for the liabilities and equities side of the balance sheet. This includes both international accounting standards (Part I of CICA Handbook) and the accounting standards for private enterprises (Part II of CICA Handbook). This course is the continuation of a two-course sequence (ACTG 3110/3120) that...
Words: 5303 - Pages: 22
...Question 1 Jim Beatty’s claim that no impairment is needed because the overall investment portfolio of public equity securities is in an unrealized gain position is invalid. According to ASC 320-10-35-20, in determining whether an investment is impaired, impairment should be assessed at the individual security level. Instead of assessing the impairment of the portfolio as a whole, Jim Beatty needs to check for impairment of individual securities. However, this also means that the company can evaluate the aggregate investment in Wells Fargo altogether, rather than just the stock that is in a loss position. Question 2 In determining whether these investments are other-than-temporarily impaired, the company should consider the following (SAB 111): • The amount of the loss and the length of time that the investment has been in a loss position. • The financial condition and near-term prospects of the issuer, including any changes or events that could affect the operations of the issuer. • The investor’s intent and ability to hold an investment until fair value recovers. Question 3 Kraft Foods and Sanofi-Aventis: The company should record other-than-temporary impairments for Kraft Foods and Sanofi-Aventis because these investments have had a fair value below cost for 24 and 30 months and the amount of the losses are large. The gross loss for Sanofi-Aventis increased during 2013. Although the gross loss for Kraft Foods decreased during 2013, it remains in a loss position...
Words: 374 - Pages: 2
...To: Michael Dore From: Qi Tian Subject: Sales Analysis Table 1: Annual Profit (in thousands of dollars) Product | 2008 | 2009 | 2010 | 2011 | 2012 | A | 12,000 | 12,000 | 9,600 | 8,000 | 4,000 | B | 4,800 | 6,240 | 8,160 | 10,560 | 14,400 | C | 3,920 | 5,600 | 7,280 | 10,080 | 11,200 | D | N/A | N/A | N/A | 5,600 | 12,000 | E | 14,400 | 13,680 | 15,840 | 10,080 | 7,200 | Total | 35,120 | 37,520 | 40,880 | 44,320 | 48,800 | Table 2: Change of Data over time Product | 2008-2009 | 2009-2010 | 2010-2011 | 2011-2012 | A | 0.00% | -20.00% | -16.67% | -50.00% | B | 30.00% | 30.77% | 29.41% | 36.36% | C | 42.86% | 30.00% | 38.46% | 11.11% | D | N/A | N/A | N/A | 114.29% | E | -5.00% | 15.79% | -36.36% | -28.57% | Total | 9.62% | 12.28% | 10.94% | 12.68% | Total 3: Annual Sales to total sales Product | 2008 | 2009 | 2010 | 2011 | 2012 | A | 28.85% | 28.32% | 18.75% | 14.08% | 6.25% | B | 19.23% | 22.81% | 26.56% | 30.99% | 37.50% | C | 13.46% | 17.54% | 26.56% | 25.35% | 25.00% | D | N/A | N/A | N/A | 9.86% | 18.75% | E | 38.46% | 33.33% | 34.38% | 19.72% | 12.50% | Total | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | Table 4: Annual Profit to total profit Product | 2008 | 2009 | 2010 | 2011 | 2012 | A | 34.17% | 31.98% | 23.48% | 18.05% | 8.20% | B | 13.67% | 16.63% | 19.96% | 23.83% | 29.51% | C | 11.16% | 14.93% | 17.81% | 22.74% | 22.95% | D | N/A | N/A | N/A | 12.64% | 24.59% | E | 41.00% | 36.46% | 38.95%...
Words: 813 - Pages: 4
...Accounting 350 – Homework #4 Name: Question 1: Purchase Commitments On September 5, 2011, Maloney Corporation signed a purchase commitment to purchase inventory for $180,000 on or before March 31, 2012. The company's fiscal year-end is December 31. The contract was exercised on March 4, 2012 and the inventory was purchased for cash at the contract price. On the purchase date of March 4, the market price of the inventory was $182,000. The market price of the inventory on December 31, 2011, was $168,000. a. Prepare the necessary adjusting journal entry (if any is required) on December 31, 2011. b. Prepare the journal to record the purchase on March 4, 2012. Question 2: Contingencies Nice Company files a lawsuit against Cheater Corp. for $4,000,000 in December 2010 alleging patent infringement. Cheater Corp.'s manager thinks it is probable that Cheater Corp. will eventually have to pay something to settle the suit, and the best estimate of the expected amount ranges from $1,200,000 to $2,400,000. In your answers below, you may ignore income taxes a. Show any related journal entries Cheater Corp. will record in 2010. b. Assume that the managers of Nice Company have information indicating that it is highly probable that Nice will win the lawsuit and they expect to collect the entire $4,000,000. Show any related journal entries Nice Company will record in 2010. c. Assume that the...
Words: 893 - Pages: 4
...ACC351A – Midterm Quiz Name Refer to the supporting documentation. 1. (10%) Below is ratio data for McDonalds, a key competitor of Wendys/Arbys. Calculate the following ratios for the 2010 fiscal year for Wendys/Arbys and indicate whether they are better or worse than the industry ratios. | |MCD |Wendys/Arbys |Better/Worse | |Net Profit Margin |20.33% |0.14% |Worse | |Revenue Growth |4.52% |96.45% |Worse | |Return on Assets |11.41% |0.1% |Worse | 2. (10%) Calculate Wendys/Arbys’ Long Term Debt to Equity ratio for fiscal year ended 1/3/10 and state whether it is better or worse than the industry average of 89.6%. Do you think that Wendys/Arbys has the capacity to incur (take on) additional debt? LTD 1,500,784/2,336,339 = 64.2% Need an answer to whether Wendy’s has the capacity for further debt. 3. (10%) Wendys/Arbys’s current stock price and P/E are $4.91 and 22.3. McDonald’s current stock price and P/E are 77.32 and 15.22. Which stock is more expensive Wendys/Arbys or McDonalds and why? Which company would you invest your hard earned money in right now and why? (Brief explanation) Wendy’s stock has a higher P/E, so more expensive. Need an...
Words: 845 - Pages: 4
...Case #2 Murong Feng, Duy Do, TJ Fritzgerald, Hayden Jacobs 2/13/15 Question 1 Given the facts provided for Eagle in Italy, the building is not impaired under IFRS as of December 31, 2010. The carrying value is 1,100,000, and undiscounted future cash flows are 1,150,000. The carrying value is less than undiscounted future cash flows. According to IAS36 paragraph 12, “in assessing whether there is any indication that an asset may be impaired, an entity shall consider, as a minimum, the following indications: (d) the carrying amount of the net assets of the entity is more than its market capitalization.” Thus, there is not any impairment on the building under IFRS. Question 2 Given the facts provided for Eagle in Italy, the building is impaired under U.S. GAAP as of December 31, 2010. Under ACS 360-35-17, “An impairment loss shall be recognized only if the carrying amount of a long-lived asset is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset” In the case, the carrying value is 1,100,000, and the fair value is 850,000. The carrying value is more than its fair value, an impairment should be recognized. However, it is recoverable since its carrying value is less than undiscounted future cash flows. In ASC 360-35-17 “An impairment loss shall be measured as the amount by which the carrying value...
Words: 1345 - Pages: 6
