Dell’s Accounting Policies for Revenues, Expenses and Net Income: Dell includes both GAAP and non-GAAP financial measures in its 10k reports. The company claims that excluding certain items GAAP gives managers a better grasp on the financial performance of the company. Dell excludes severance and facility actions, and acquisition related costs from its GAAP financial measures, and also the amortization of intangible assets. Dell acknowledges that its non-GAAP financial measures may not be
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customer a sales incentive or other consideration addresses the circumstances under which that consideration is either: • a. An adjustment of the selling prices of the vendor’s products or services and therefore characterized as a reduction of revenue when recognized in the vendor’s income statement • b. A cost incurred by the vendor for assets or services received from the customer and therefore characterized as a cost or expense when recognized in the vendor’s income statement” FASB Accounting
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iPhone at Apple, Inc.: The case provides students with an understanding of the criteria for revenue recognition and the role of accrual accounting in reflecting timing differences between cash receipts and product/service delivery, especially in situations where there are multiple deliverables. The case also enables students to reflect on (a) the use of supplementary non-GAAP disclosures, (b) the impact of accounting on firm value and (c) the role of companies in the standard setting process
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based on revenue accumulation and profit margins. The simulation strategy will mainly concentrate on revenue recognition which refers to an accounting principle that involves cash basis accounting and accrual basis accounting. Cash basis involves recognizing revenues when cash is received while accrual basis accounting recording revenues when cash is realized or earned. Products X3 X4 X5 X6 X7 Current revenue 774,307,366 362,007,649 363,450,944 48,848,773 42,987,651 Annual revenue 470,680
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They appeal to the most fashionable clientele because the company cultivates celebrities and holds events to attract them. By revenue, Starwood is in the middle, and has the lowest ratio which generates 1/3 of sales from food and beverages. Additionally, the return on equity and return on assets is in the bottom half of the competitor; leaving Marriott to produce 50% more revenue than Starwood. Hyatt Hotels Corporation is a top operator of luxury hotels and resorts that managed, franchised, and owned
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CHAPTER 5 Revenue Recognition and Profitability Analysis Part A: Introduction to Revenue Recognition I. Revenue Recognition in General A. FASB definition: "Revenues are inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations." In other words, revenue tracks the inflow of net assets that occurs
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Revenue is defined in the Framework for the Preparation and Presentation of Financial Statements (2008) as increase in economic benefits during the accounting period in the form of inflows or enhancements of assets or decrease of liabilities that result in increase in equity, other than those relating to contributions from equity participants. Revenue is measured at the fair value of the consideration received or receivable taking into account the amount of any trade discounts and volume rebates
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is doubtful, revenue may be recognized as cash is received instead of accruing revenues. As a lease, the purchase of the fractional interest in the airplane would not imply ownership. It would simply be considered prepaid rent or an advance lease payment. It should therefore be recognized in periodic installments over the period of the lease. This way, if the lessee decides to terminate the contract, it will be easier to calculate how much he is due back and how much of the revenue should be allocated
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September 27, 2008, (see Exhibit 1). Under the U.S. generally accepted accounting principles (GAAP), Apple reported quarterly revenue of $7.9 billion and net profit of $1.1 billion. For the first time, the Cupertino, California-based company included non-GAAP measures in its earnings announcement to supplement its U.S. GAAP financial results. Apple´s non GAAP quarterly revenue and net profit were $11.7 billion and $2.4 billion, respectively. As Apple CEO Steve Jobs noted, “As you can see the non-GAAP
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Joan Holtz 1. Electric Utility Bills Revenue of the Electric Company can be measured given the amount of electricity generated for the year multiplied by the per-kilowatt/hour charge to customers. This is because the electric service has already been provided and distributed to customers for ready consumption 2. Retainer Fee The amount of revenue to be counted in 2010 is $5,000 from the $10,000 retainer fee good for 1 year. This is because, despite the fact that there was no way
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