company’s virtual world, stuffed with fun. Build-A-Bear Workshop. Source: Company Web site. Learning Objectives • Understand the economic incentives of leasing versus buying assets. • Interpret lease footnotes and discussion of commitments and contingencies. • Relate lease footnote disclosures to balance sheet data. • Understand the balance sheet and income statement effects of lease accounting. • Perform present value calculations relating to lease obligations. • Create pro-forma financial statements
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Chemical business area after a major earnings increase in 2010 saw their earnings drop slightly in 2011. My financial assessment, review and analysis of ExxonMobil’s 2011 financial statements and 10K follows; focusing on profitability ratios as well as current business operations. ExxonMobil 2011 Financial Statement Analysis and Assessment ExxonMobil employs a business model “focused on achieving excellence in our daily operations, generating superior cash flow, and creating long-term shareholder value”
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buildabearville.com®, the company’s virtual world, stuffed with fun. Source: Company website. Learning Objectives • Understand the economic incentives of leasing versus buying assets. • Interpret lease footnotes and discussion of commitments and contingencies. • Relate lease footnote disclosures to balance sheet data. • Understand the balance sheet and income statement effects of lease accounting. • Perform present value calculations relating to lease obligations. • Create pro-forma financial statements
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on the board of directors, participation in policy-making, etc. 2. According to GAAP guidelines, the equity method is presumed to be applicable if 20 to 50 percent of the outstanding voting stock of the investee is held by the investor. Current financial reporting standards allow firms to elect to use fair value for any investment in equity shares including those where the equity method would otherwise apply. However, the option, once taken, is irrevocable. After 2008, an entity can make
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located. Topical Categories: Section # General Principles ................................... 100 Presentation .............................................. 200 Assets........................................................... 300 Liabilities...................................................... 400 Equity........................................................... 500 Revenue........................................................ 600 Expenses.....................................
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FASB has stated in Statement No. 5 if there is a loss contingency that is probable and reasonably estimable it should be accrued against income in the current year. If no accrual is recognized because of uncertainty surrounding the probability or estimability of the contingency a disclosure of the contingency should be made when there is at least a reasonable possibility that a loss will occur. In this disclosure the nature of the contingency and an estimate of the possible loss or range of loss
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Characteristics of a liability 1. It embodies a duty or responsibility 2. There is little or no discretion to avoid a future transfer or use of assets to satisfy the obligation, and 3. The obligating event has already occurred. In June 2001 the FASB issued a Statement No. 143, Accounting for Asset Retirement Obligations requiring entities to record liabilities for tangible, long-lived assets that must be retired or disposed of in a specified way by law or contract. Such liabilities are known as Asset
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Problem 16–1 Requirement 1 Related Asset – Cumulative Balance (not required) ($ in thousands) Collections Service Revenue Service previous current Receivable Revenue year year Balance 2012 $30 2013 $750 30 740 10 2014 715 10 690 25 2015 700 25 695 5 Problem 16–1 (continued) ($ in thousands) Current Future Year Taxable 2013 Amount Pretax accounting income 250 Temporary difference: 2012 services (30) 30 2013 services
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off on recording the loss until a settlement has been reached. A contingency is an existing situation dealing with the possibility of a loss or gain to a company that will be a result from future events failing to occur. The chances of winning the case are remote which means Camp Industries is not likely to win the law suit. According to the standards of financial accounting and reporting states “An estimated loss from a loss contingency shall be accrued by a charge to income if both of the following
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What is a liability? The answer might seem rather obvious: an amount owed from one entity to another. If the liability bears interest, how is interest expense measured? The simple answer is that interest expense is equal to interest paid. However, life can get a lot more complicated: Does a liability exist if there is no legal liability, but the company has announced a particular commitment or plan of action? How is a liability measured if the obligation is for services, not a set amount of money
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