Statements March 31, 2012 Note 1 Summary of Significant Accounting Policies Use of Estimates Preparing financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates are based on management’s knowledge regarding current events as well as the potential outcome of future economic events. Actual results may differ from those estimates. Revenue Recognition
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(IP), as it has being recognized as a Valuable Business Asset. The Value of IP is much different & Valuation is much difficult than the value of any other assets. IP is creation of Human mind but to know the value or to trade that property we have to “value” them. The three main approaches are Market Approach, Income Approach & Cost Approach. Introduction Business enterprise is comprised of Working Capital, Fixed Assets, Intangible Assets and Intellectual Property. The increasing challenges of
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Chocolate Factory manufactures the inventory it sells at stores it owns and sells product to franchisees. The company is a manufacturer/retailer; and thus one can predict that the balance sheet will include inventories and property and equipment on the asset side. As the company is a retailer, we would not expect a large accounts receivable balance (their sales are for cash or on credit cards, which are the same as cash from their perspective). However, their franchisees may owe substantial royalty payments
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historical cost of an asset over its useful life in order to conform with the idea that the earnings of the company is matched accordingly with relative expenses including the wear and tear of the assets used in production, construction, and other purposes. When is it appropriate for businesses to calculate depreciation using two different methods and why?? Valuation is the process of estimating the market value of a financial asset or liability. Valuation refers to the asset being recorded and disclosed
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add functionality of property are capitalized. The gross amount of assets under capital leases is included in property, plant and equipment. Expenditures for repairs and maintenance are charged to expense as incurred. They depreciate all depreciable property using the straight-line method. Leasehold improvements are amortized over the period of lease or the life of the asset, whichever is shorter. The amortization of the assets under capital leases is included in depreciation expense. Upon retirement
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ASSETS & LIABILITIES Asset is an item of value owned by the company. Assets can be tangible i.e. those which have some physical existence or can be intangible i.e. which do not exist in physical form but can be held in the form of contracts or rights. Assets are usually grouped in order of liquidity (ease of conversion to cash) on the balance sheet. Cash is therefore the most liquid of all assets. Assets can be classified as: 1.) Current Assets – Those assets that are expected to be converted
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includes its inventory in “other current assets” on the balance sheet, which are valued at the lower of cost or market. Telecom Italia lists its inventory as a line item under current assets. It also adopts lower of the cost or market to evaluate its inventories. It is a one-step test by simply comparing the market ceiling value and the cost of inventory. Telecom Italia wrote down by 4 million based on the adjustment to estimated realizable value of its fixed asset. Leases The guidance for distinguish
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about the basic issues that related to accounting for intangible assets. I also gained knowledge of the differences between revenue expenditures and capital expenditures within a company's financial statements. I just realize how important these basic issues are to the companies financial status. There are many businesses that have no earned income, which will be a liability to the company. I do seem to have great knowledge on intangible assets just by listening and comprehending in the readings and
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Accounting Standards Board Juanika Hogue ACC 541 – Accounting Theory and Research September 8, 2014 Valerie Turnbow The FASB begin with the abolishment of the APB (Accounting Principles Board) after the recommendation of the Wheat committee in 1972. The IASB is a private board created in 1973 to create accounting standards to be observed worldwide. Beginning with the Norwalk agreement in 2002 the FASB and the IASB committed both entities to making mutually compatible standards both foreign
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unaudited) Quarter Ended March 25, 2006 Quarter Ended March 19, 2005 Net Revenue . . . . . . . . . . . . . . . . . . . . . . Cost of sales . . . . . . . . . . . . . . . . . . . . . . . Selling, general and administrative expenses Amortization of intangible assets . . . . . . . . . Operating Profit . . . . . . . . . . . . . . . . . . . Bottling equity income . . . . . . . . . . . . . . . . Interest expense . . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . . . . . .
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