...Technical Case Studies SOLUTIONS Case: Accounting for Lease Extension (Revised and updated 5/2013) Jack leases an office building from Jill. The lease is classified as an operating lease under the guidance of ASC Topic 840, Leases. The lease does not include any renewal options upon the expiration, but Jack is in the process of negotiating an extension of the lease. Jack proposes to make a single up-front payment of $1.2 million to Jill in exchange for an extension of the lease at the current rate for another 10 years. The extension would create a new lease under ASC par. 9 of 840-10-35-4. 1. 2. Should Jack include the $1.2 million in the calculation of the minimum lease payments when classifying the new lease? Assuming the new lease would qualify as an operating lease under ASC 840, when should Jack recognize the $1.2 million as rental expense? A1: Yes. Jack should include the up-front payment in the calculation of the minimum lease payments. ASC par. 840-10-25-5 defines minimum lease payments from the standpoint of the lessee as “ ...the payments that the lessee is obligated to make or can be required to make in connection with the leased property…,excluding...(a) contingent rentals, (b) any guarantee by the lessee of the lessor’s debt and the lessee’s obligation to pay (apart from the rental payments) executory costs such as insurance, maintenance, and taxes in connection with the leased property. The $1.2 million is not a contingent rental, a guarantee of Jill’s ” debt...
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...report on one of the case studies. At the beginning of term, student groups will be randomly assigned to one of the following two cases: “Valuation of AirThread Connections” or “Dividend Policy at FPL Group, Inc.” Please find out which case you have been allocated to and the week in which that case is discussed. In the following I explain which deadlines you have to meet and how effort towards each deadline contributes to your coursework mark: • Deadline 1. You must read up your case material and prepare oral answers to the case questions by the Thursday lecture to which your case discussion is allocated. Groups that have not prepared before the case discussion will suffer a coursework mark penalty. The penalty will be 10 points of the coursework mark (e.g., a drop from 60% on your submission to 50% overall). Groups that have fully prepared and present their arguments during the class discussion in a lively and enthusiastic way will receive a 5-point coursework mark uplift (e.g., an increase from 70% to 75%). • Deadline 2. The next deadline is for submission of your complete case report. This must be done on Moodle, by the Thursday one week after the case discussion week. Therefore, the deadlines for submitting the written report are as follows: – Groups assigned to the AirThread case: Thursday 27 March – Groups assigned to the FPL case: Thursday 3 April. Advice on how to write the case report Each group will have to prepare a written report for its assigned case. The report should...
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...objective of this course is deepen your understanding of the many issues faced by firms as they identify valuable investment opportunities, raise funds for those investment opportunities, distribute profits to share-holders and debt-holders and deal with the consequences of both good and bad investment financing decisions. We will expand on the concepts that you have learned in FINA 760 or in DMSB 715. Class time will be divided between lectures and case studies. My lectures will briefly review concepts from prior courses. The bulk of my lectures will present advanced material that will be new to you. It is assumed that you understand the concepts from your earlier finance and accounting courses. If not, it is your responsibility to review. In order to reduce your note-taking, my lecture notes will be available on the class web-site in PowerPoint format. I suspect that you will have difficulty paying attention for a full 2.5 hours some days. Thus, I intend to supplement live lectures with recorded lectures on a case-by-case basis. Recorded material can be viewed at your leisure when you are fresh and attentive. In addition to lectures, we will spend a significant amount of time analyzing...
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...Case 7 1: Stern Corporation (B)* Note: This case is updated from the Twelfth Edition. Approach This is a straightforward problem, designed for use in connection with study of the text. I find it useful to put T-accounts on the board or on a Vugraph and post entries to them as they are given. The account titles given in the balance sheet should be used. The case assumes individual unit depreciation. It may be desirable to ask at some point what the entries would be if composite or group depreciation were used. Comments on Questions Question 1 1. Cash 3,866 Accumulated Depreciation, Factory Machinery 27,367 Factory Machinery 31,233 2. Tools Used (Expense) 7,850 Tools 7,850 (Note the contrast between depreciation and a direct write-off.) 3. (a) Depreciation Expense 278 Accumulated Depreciation, Automotive Equipment 278 (The additional depreciation is 1/6 x .20 x $8,354. Note that the half-year convention is not used. Note that if the depreciation incurred in 2006 is disregarded, the loss will be overstated.) (b) Cash 2,336 Accumulated Depreciation, Automotive Equipment 5,458 Loss on Sale of Other Assets 560 Automotive Equipment 8,354 (There can be a discussion of the proper showing of the loss on the income statement.) 4. Patent Amortization Expense 11,250 Patent 11,250 5. Cash 75 Accumulated Depreciation, Office Machines 1,027 Gain on Sale of Other Assets 75 Office Machines 1,027 ...
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...Income and revenue are fresh blood for organizations regardless of governments, private sectors or nonprofits. The studies of the income sources, where the money goes and how the money is spent in nonprofit are essential to help finance managers and leaders understand how the organization operated in the context of current economic situation and to give a general quantitative analysis in terms of activities and programs executed by organizations. Knowing how finance and budget management looks like in nonprofits is also key to distinguish with for- profit organizations. This critique will start with the functions of finance management in the nonprofits and why we need to be prudent to make fiscal decisions, then I will focus on the diversification...
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...statements prepared in accordance with US GAAP, however differences between US GAAP and IFRS will be outlined and examined. The class will be taught using a combination of lectures, class discussions and real-world case studies. In order to maximize our time together, students are expected to read the assigned chapters and complete the case studies on time. Given the brevity of the course and lecture time, students are encouraged to email me directly with questions at any time. Required Materials Textbook: Financial Statement Analysis & Valuation, (3rd Edition), By Easton, McAnally, Sommers & Zhang, Cambridge Business Publishers, 2013. ISBN: 978-1-61853-009-7 Case studies will be provided on TLE. Grading Schedule Class Participation/Case Work: Individual Project: Mid-Term/Exam 1: Final Exam: 20% 30% 20% 30% Grading Expectations Class Participation/Case Work: Each student should be prepared to discuss the required readings. To satisfy the requirements of class participation, students will be required to answer direct questions from the instructor and must actively participate in group discussions. 1|Page Case Work assignments must be turned in by the due-dates listed below. Late assignments will not be accepted. Please bring two copies of the completed cases to class (one for discussion, one to turn in). Individual Project: The specific requirements for the individual project will be outlined in greater detail on TLE. Students must select a non-financial, non-biotechnology...
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... Kudler Fine Foods is a small network of specialty grocery stores. They have asked us to study and comment on their computer systems and information technology. In particular they are interested how technology can be effectively integrated into their operations. Following are their key business needs for information technology: cash registers, human resources and accounting department. Cash registers service for processing credit card payments or cash payments. Simultaneously as transactions are rung up, these systems also collect data that influence reports and other data. Sales information send data to general ledger, updating debits and credits, calculates cost of goods sold, calculates inventory and calculates daily profit. Human resources collect employee data that relates to their payroll, tax liabilities, performance and disciplinary issues. Also HR creates reports for OSHA and Equal Employment Opportunity Commission. Quick Books software is used to create employee database that includes such information about employees as pay rate, exemptions, seniority date. Accounting department is involves information systems in several areas. They collect data from POS to update General Ledger, some manual entry is involved. Bank helps accounting department to create cash reports. Accounting department handles check printing, control bank accounts, sets up cash accounts for cash payments to local farmers, separates funds for payroll. Kudler is a newer company and is on the...
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...Chapter 12: Intangible Assets Intangible assets: lack physical substance, are subject to a high degree of uncertainty concerning future benefits. Examples: patents, copyrights, franchises, goodwill, organization costs, trademarks. The same accounting issues relating to plant assets also apply to intangibles. However, by their nature intangibles are often more difficult to identify, value, and estimate a useful life. Intangibles can be categorized according to: - whether they are separately identifiable (examples included patents, trademarks, etc), or inseparable from the firm's other assets (goodwill). - whether they are externally purchased, or developed internally. Accounting for costs related to intangible is governed by APB 17 and FAS 2. In general: - all costs related to external purchases of intangibles are capitalized and amortized as expense over the periods benefitted. - the maximum amortization period is 40 years. - the straight-line method must be used unless some other method can be shown to be more appropriate. - costs related to intangibles that are internally developed are expensed as incurred. Exceptions (which are capitalized) are: external legal fees for successfully defending rights to patents, etc., organizational costs, and R&D expenditures for long-lived assets that have alternative future uses (these assets are capitalized and depreciated, with the depreciation allocated to R&D). Specifically Identifiable...
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...Title: The Fall of IBM Date: September 20, 2013 I. Executive Summary The purpose of this case study analysis is to analyze the situation of IBM in the 1990s, to come up with possible mutually exclusive alternatives for IBM’s management and ultimately, to recommend a possible strategy to regain back IBM’s throne in the industry. The problem of the case study is all about the survival of IBM in a much more competitive market ever encountered by the company. And also, overcoming new challenges brought about IBM’s new management and the dynamic technological environment. The methods of analysis used for this case study are the Porter’s Five Forces Model and the ANSOFF matrix analysis. Brief explanations were provided in each of the methods used for analysis. After analyzing the case study, the following three mutually exclusive alternative course of action were developed: 1. Decentralize Management; 2. Invest heavily on research and development and; 3. Partner with suppliers From the alternatives, I recommend that IBM should partner with its suppliers. Collaboration with suppliers will increase business flexibility and executive level business decision support. This will surely bring the most benefit for the company among the other alternatives course of action. The suppliers play a great role in the industry and having strong connections with them can help the company survive and even excel in the industry. Outline and Implementation: ...
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...is social responsibility the only mandate? Perhaps for Fannie Mae who was established by federal charter to meet such a mandate, this might be the case, but Milton Friedman argues that “there is one and only one social responsibility of business . . . increase its profits” (1970, para. 33). This author believes that if a company does not minimally maintain cash flow, or “real” profits, over the long term, it will be unable to meet any contrived social responsibility or survive. How an organization goes about maintaining or increasing cash flow brings into play the idea of governance, which “comprises the roles, responsibilities, and balance of power among executives, directors, and shareholders” . According to Aguilera and Cuervo-Cazurra (2004) there are two purposes of corporate governance policy; improving quality of governance (or the running of the company), and increasing accountability of the leadership. Fannie Mae’s leadership was fixated on a single indicator of company success, while using its other accolades as a means of inviting investment. Ethics indicates the behavior that all individuals should take in any given situation. In regards to Fannie Mae’s governance, the behaviors engaged in by upper management were contrary to good governance, and ethics. This author believes that there is no direct connection between social responsibility and ethics –...
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...DESIGNING AND IMPLEMENTING A TRANSACTING SYSTEM OR AN ATM MACHINE. A CASE STUDY OF ECO BANK PLC, OBOSI ONICHA). BY -------------------------- ------------------- A PROJECT SUBMITTED TO THE DEPARTMENT OF COMPUTER SCIENCE, SCHOOL OF ENGINEERING TECHNOLOGY, ------------------------ IN PARTIAL FULFILMENT OF THE REQUIRMENT FOR THE AWARD OF ---------- IN COMPUTER SCIENCE OCTOBER, 2010 APPROVAL PAGE I certify that the study reported in this page was carried out by --------------- in the department of Computer Science, School of Engineering and Technology ------------------- --------------------------------- ----------------------- -------------- Date (Project Supervisor) --------------------------------- ------------------------ -------------- Date (Head of Department) ----------------------------- -------------------------- External Examiner Date TABLE OF CONTENT Title page i Approval Page ii Table of content iii Dedication Acknowledgment Abstract CHAPTER ONE 1. Introduction 1. Background of the study 1. Statement of the problem 2. Objective of the study 3. Scope of the study 4. Significant of the study 5. Limitations of the study CHAPTER TWO Literature review 2.1 A.T.M 2. History of A.T.M 2.3. Components of A.T.M 2.4 functions of A.T.M CHAPTER THREE 3.0 analysis of the existing system 2. Research methodology 3...
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...CARDIFF SCHOOL OF MANAGEMENT: ASSIGNMENT FEEDBACK PROFORMA |STUDENT NAME: |PROGRAMME: | |STUDENT NUMBER: |YEAR: 20012-13 |GROUP: | |Module Number: BCO5007 |Term: Yr |Module Title: Networking | |Tutor Responsible For Marking This Assignment: Steve Marsh Dr Simon Thorne | |Module Leader: ST/SM | |Assignment Due Date: |Hand In Date: 16th December 2012 | |ASSIGNMENT TITLE: Network Provision for Building Society | |SECTION A: SELF ASSESSMENT (TO BE COMPLETED BY THE STUDENT) | |In relation to each of the set assessment criteria, please identify the areas in which you feel you have strengths and those in which you need to improve...
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...OF THE COURSE: FINANCE II CREDITS: 4 Name of the Faculty Arnab Bhattacharya Gaurav Singh Chauhan Kousik Guhathakurta Radha M. Ladkani Faculty Block/ Room No. J BLOCK C-102 A-106 J BLOCK Email Telephone Number arnabb@iimidr.ac.in gauravs@iimidr.ac.in kousikg@iimidr.ac.in; radhal@iimidr.ac.in; 0731-2439589 0731-2439592 0731-2439518 0731-2439698 COURSE DESCRIPTION The second core course in Finance deals with the core corporate finance functions in an applied setting. The participants are exposed to real world corporate finance decisions to be taken up by managers for creating value. Such an exposure is accomplished through a mix of theory and practice. The pedagogy employed reflects a judicious mix of case discussions, lectures and problem solving approach. COURSE OBJECTIVES The objective is to familiarize participants with the three major decision areas of Corporate Finance, viz. the investments, financing and earnings distribution decisions. Subsequently the participants are to be offered an integrated view of the decision areas by discussing the issues in corporate valuations and risk management. The course aims at sharpening the financial decision making skills of the participants. EXPECTED LEARNING OUTCOMES AND ASSOCIATED MEASURES At the end of the course student is expected to accomplish the following learning outcomes. Alignment of Course Learning Outcomes (CLOs) with the Programme Learning Goals & Objectives and Assessment...
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...Development Policies For South Cotabato II Electric Cooperative, Inc. J. Catolico Avenue, Lagao, General Santos City A Business Policy Development Research In Management in Business Policy (Management 4) Presented to: Mr. Elmer Fernandez Abesia Subject Professor Presented by: Jaypee Palcis Herminio Gianan Cherry Mae Sacamay ACKNOWLEDGEMENT This research would not have been possible without the guidance and the help of several individuals who in one way or another contributed and extended their valuable assistance in the preparation and completion of this study. First and foremost, our utmost gratitude to Mr. Elmer Fernandez Abesia, our teacher in Management 4 whose sincerity and encouragement I will never forget. Mr. Abesia has been our inspiration as we hurdle all the obstacles in the completion of this research work. To Mrs. Helen Rose B. Aponesto, People Management Supervisor of SOCOTECO II for accommodating us and answering our questions despite her hectic schedule. To the staff of the Human Resource Department of SOCOTECO II for being helpful in the preparation of documents we requested. To our classmates who in one way or another were of assistance especially during the preparation of business letters prior to conducting this research. Last but not the least, our family and the one above all of us, the omnipresent God, for answering our prayers and giving us the strength to plod on despite our constitution wanting to give up and throw in the towel...
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...OpenLGU - Software Requirements Specification for ASSESSMENT REPORT Version 1.4 Prepared by Group Name: 204 Maria Kristina Dina Hazel Gatmaitan 2008-34358 2009-61185 mkristinadina@gmail.com hazelgatmaitan4science@gmail.com Lab Section: Lab Instructor: Date: AB-5L Andrel Del Rosario January 11, 2012, Wednesday Software Requirements Specification for Assessment Page ii Contents IN THIS TEMPLATE YOU WILL FIND TEXT BOUNDED BY THE “” SYMBOLS. THIS TEXT APPEARS IN ITALICS AND IS INTENDED TO GUIDE YOU THROUGH THE TEMPLATE AND PROVIDE EXPLANATIONS REGARDING THE DIFFERENT SECTIONS IN THIS DOCUMENT. THERE ARE TWO TYPES OF COMMENTS IN THIS DOCUMENT. THESE COMMENTS THAT ARE IN BLACK ARE INTENDED SPECIFICALLY FOR CMSC128. THESE COMMENTS THAT ARE IN BLUE ARE MORE GENERAL AND APPLY TO ANY SRS. PLEASE, MAKE SURE TO DELETE ALL OF THE COMMENTS BEFORE SUBMITTING THE DOCUMENT. .................................................................................................................................III THE EXPLANATIONS PROVIDED BELOW, DO NOT COVER ALL OF THE MATERIAL, BUT MERELY, THE GENERAL NATURE OF THE INFORMATION YOU WOULD USUALLY FIND IN SRS DOCUMENTS. IT IS BASED ON THE IEEE REQUIREMENTS AND WAS ADAPTED SPECIFICALLY FOR THE NEEDS OF SOFTWARE ENGINEERING COURSES. MOST OF THE SECTIONS IN THIS TEMPLATE ARE REQUIRED SECTIONS, I.E. YOU MUST INCLUDE THEM IN YOUR VERSION OF THE DOCUMENT. FAILURE TO DO SO WILL RESULT IN MARKS DEDUCTIONS. OPTIONAL SECTIONS WILL BE EXPLICITLY...
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