4277 APRIL 4, 2011 JAMES L. HESKETT RICHARD LUECKE Porcini’s Pronto: “Great Italian cuisine without the wait!” In January 2011 Tom Alessio, marketing vice president at Porcini’s, Inc., of Boston, was pondering issues raised by a potential expansion of his company’s restaurant business. The domestic market for full-service chain restaurants was nearing its saturation point at both in-city and shopping mall locations. The big chains were looking overseas for growth, but as a small regional
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made using available data pertaining to the company’s assets, liabilities, revenue and expenses. Other areas where estimation may occur are future tax liability projections, fair value estimation and impairment calculation on investments. 4. Revenue Recognition Revenue is recognized when a service contract is signed, service is rendered, or evidence of an arrangement exists and collectability is probable. Revenues indicated are net of taxes collected for federal and state purposes and thus
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1) The accounting process is correctly sequenced as A. identification, communication, recording. B. recording, communication, identification. C. identification, recording, communication. D. communication, recording, identification. 2) Which list below best describes the major services performed by public accountants? A. Bookkeeping, mergers, budgets B. Employee training, auditing, bookkeeping C. Auditing, taxation, management consulting D.
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Dividends 500 Revenues 15,000 Expenses 13,000 What did LBJ Company show as total debits? (Points : 5) | $34,000 $36,000 $70,000 $31,000 | 4. (TCOs B, E) Why is the accrual basis of accounting preferred by GAAP? (Points : 5) | The Accrual basis is easier to use. The Accrual basis is also preferred by the Internal Revenue Service. The Accrual basis complies with the revenue recognition and matching principles
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Upside/Downside Valuation HK$ % HK$ 2.90 6.2 2.90 - PER GICS sector Capital Goods Market cap HK$m 11,685 30-day avg turnover US$m 6.5 Market cap US$m 1,502 Number shares on issue m 4,280 Investment fundamentals Year end 31 Dec Revenue EBIT EBIT growth Reported profit EPS rep EPS rep growth PER rep Total DPS Total div yield ROA ROE EV/EBITDA Net debt/equity P/BV 2010A 2011E 2012E 2013E m 12,020 14,316 16,692 19,605 m 2,322 2,538 2,810 3,158 % 140.1 9.3 10.7
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GAAP states that revenues should only be recorded when they are earned (goods are transferred or services are rendered). Our recommendation, in accordance to GAAP, is that WAG not recognizes these sales until the goods are transferred. Recognizing the sales before they are delivered (not in accordance with GAAP) would overstate net income. Revenues from ‘Artwork Sales’ should be restated at $30,600. As a direct result of sales being adjusted due to revenue recognition issues in accordance
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More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. More Than a Numbers Game More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. Copyright © 2006 by Thomas A. King. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or
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INNOVATION AT [pic]: Thinking Outside the Shoe Box CASE ANALYSIS I. Problem What uniting mechanism can Timberland Company administer to achieve the fullest potential of appropriate product design and process given the existing disparity between the In-line teams and Invention Factory? II. Objectives a. To ensure that the manufactured product is to be positively responded by the consumers. b. To provide sufficient focus to ensure the best use of resources
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As stated earlier, they have several approved medicines that are already in the market where they have absolute market penetration. However, over the years contracts expire, and new drugs must be developed. These new sources of revenue must replace declining revenues of products that have expired and can be copied by competitors. If research & development employees failed to deliver innovative products to sustain Amgen, this is one market risks that would have to be taken into consideration. Another
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Corporate Governance and Accounting Conservatism in China* Donglin Xiaa and Song Zhub,** b School of Economics and Management, Tsinghua University, China School of Economics and Business Administration, Beijing Normal University, China a Abstract A principal-agent relationship exists among creditors, shareholders and management, and information asymmetry among them leads to asymmetric loss functions, which induces conservative accounting. This paper investigates the determinants of accounting
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