Case 2 Bucks
ACTG 350 – Case 2
Due:
Tuesday, December 2nd (at the beginning of class).
Required:
Complete the requirements outlined in the following case developed by the
Deloitte Foundation. Your memo should carefully develop arguments supporting your conclusions based on your interpretation of ASC 230-10.Your memo should not exceed 3 pages and be formatted in a professional manner. Please submit one case per group.
To access ASC 230-10 please log into the FASB Accounting Standards Codification website: http://aaahq.org/ascLogin.cfm Student Access
Username - AAA51526
Password - x43AYtX
Buck’s Dilemma: Gross or Net?
Buck’s Hunting Equipment Inc. (“Buck”) is a retailer of hunting equipment, hunting apparel, and outdoor accessories. Buck’s operations are based in Pittsburgh, PA, with retail stores located in the nearby suburbs and throughout southwestern Pennsylvania. Buck is actively developing opportunities to expand its operations in the surrounding region, including construction of several new retail stores in West Virginia and southern Ohio. Buck intends to complete construction and open each of the new stores over the next three years. Buck anticipates incurring significant expenses and making short-term cash outlays during the construction phase of the expansion. As a result of this growing need to obtain new, readily available capital, Buck entered into a three-year revolving line of credit (the “Facility”) with its bank on January 1, 2010. The line of credit has a maximum borrowing capacity of $100 million.
Since Buck has not previously used a revolving line of credit, it does not have knowledge of the relevant accounting literature and guidance on how to present the related cash flows in its financial statements. Accordingly, as Buck’s external auditor, management has asked for your assistance in determining the appropriate presentation of the borrowing and payment activity within its statement of cash flows for the year ended December 31, 2010.
Required:
1. Should
Due:
Tuesday, December 2nd (at the beginning of class).
Required:
Complete the requirements outlined in the following case developed by the
Deloitte Foundation. Your memo should carefully develop arguments supporting your conclusions based on your interpretation of ASC 230-10.Your memo should not exceed 3 pages and be formatted in a professional manner. Please submit one case per group.
To access ASC 230-10 please log into the FASB Accounting Standards Codification website: http://aaahq.org/ascLogin.cfm Student Access
Username - AAA51526
Password - x43AYtX
Buck’s Dilemma: Gross or Net?
Buck’s Hunting Equipment Inc. (“Buck”) is a retailer of hunting equipment, hunting apparel, and outdoor accessories. Buck’s operations are based in Pittsburgh, PA, with retail stores located in the nearby suburbs and throughout southwestern Pennsylvania. Buck is actively developing opportunities to expand its operations in the surrounding region, including construction of several new retail stores in West Virginia and southern Ohio. Buck intends to complete construction and open each of the new stores over the next three years. Buck anticipates incurring significant expenses and making short-term cash outlays during the construction phase of the expansion. As a result of this growing need to obtain new, readily available capital, Buck entered into a three-year revolving line of credit (the “Facility”) with its bank on January 1, 2010. The line of credit has a maximum borrowing capacity of $100 million.
Since Buck has not previously used a revolving line of credit, it does not have knowledge of the relevant accounting literature and guidance on how to present the related cash flows in its financial statements. Accordingly, as Buck’s external auditor, management has asked for your assistance in determining the appropriate presentation of the borrowing and payment activity within its statement of cash flows for the year ended December 31, 2010.
Required:
1. Should