Chapter 10 Plant Assets‚ Natural Resources‚ and Intangibles QUESTIONS 1. A plant asset is tangible; it is used in the production or sale of other assets or services; and it has a useful life longer than one accounting period. 2. The cost of a plant asset includes all normal and reasonable expenditures necessary to get the asset in place and ready for its intended use. 3. Land is an asset with an unlimited life and‚ therefore‚ is not subject to depreciation. Land improvements have
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FINANCIAL STATEMENT ANALYSIS APOLLO TYRES LTD. As Part of the Course On FINANCIAL ACCOUNTING INTRODUCTION Apollo Tyres Ltd. is a leading Indian tyre manufacturer which commenced its production in 1977 under the leadership of Raunaq Singh. It is built around the core principles of creating shareholder value through reliability in its products and dependability in its relationships with stakeholders. The company offers a range of tyres to consumers in heavy‚ light and passenger vehicles category
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Involves the inability to fund increase in assets‚ manage unplanned changes in funding sources and to meet obligations as when required‚ without incurring additional costs or increasing a cash flow crisis. Liquidity risk arises from situations in which a party interested in trading an asset cannot do it because nobody in the market wants to trade for that asset. Liquidity risk becomes particularly important to parties who are about to hold or currently hold an asset‚ since it affects their ability to trade
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Chapter 1: Introduction to accounting Multiple Choice 1. Which of these is a decision relevant to the accounting function of an entity? a. Whether debts can be repaid b. Finding the most cost effective way to produce goods c. The investment prospects of the entity d. None of the above e. All of the above 2. Under the Framework describes the qualitative characteristic of relevance as: a. information that is of value to users in decision making. b. information that can be classified. c.
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correct address 2. Years customer has been in this business Other – establishes track record and history 3. Total assets and estimates of values of assets in the business Economic – establishes size of asset base of business 4. Total liabilities (total commitments) Economic – establishes how much the business currently owes others to assess the extent of claims against assets 5. Profits of the business for the most recent and previous periods Economic – used to assess whether the business
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of initial recognition! - Initial recording and subsequent reporting similar to FVTPL! - Gains and losses (realized and unrealized) are through OCI (never P&L) while dividends are recorded as income! - Transaction costs added to the cost of the asset (impairment losses inherent)! - Similar to available-for-sale classification under IAS 39 except with AFS all gains or losses accumulated in OCI are transferred to net income upon sale! - Strategic investments are part of operating strategy and are
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the value of the asset along with the corresponding lease liability must be shown on the lessee’s balance sheet. Capital and Operating Leases Leases that conform in principle to this definition are called capital leases. More specifically‚ a lease is regarded as a capital lease if it meets one or more of the following conditions: 1. The lease transfers ownership of the asset to the lessee by the end of the lease period. 2. The lease contains an option to purchase the asset at a bargain price
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INTRODUCTION TO PROJECT Financial statement analysis is largely a study of relationship among the various financial factors in a business as disclosed by a single set of statements and statements. Financial statements analysis is an attempt to determine the significance and meaning of the financial statement data so that forecast may be made of the future earnings‚ ability to pay interest‚ profitability of a sound policy. The charts were used accordingly to support the analysis. Need of the study:
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When a company has been making losses for a number of years‚ the financial position does not present a true and fair view of the state of the affairs of the company. In such a company the assets are overvalued‚ the assets side of the balance sheet consists of fictitious assets‚ useless intangible assets and debit balance in the profit and loss account. Such a situation does not depict a true picture of financial statements and shows a higher net worth than what the real net worth ought to be
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ACCOUNTING PROJECT Tiffany & Co. Company Profile Tiffany & Co. is a holding company that operates through its subsidiary companies (the "Company"). The Company’s principal subsidiary‚ Tiffany and Company‚ is a jeweler and specialty retailer‚ whose merchandise offerings include an extensive selection of jewelry (91% of net sales in fiscal 2011)‚ as well as timepieces‚ sterling silverware‚ china‚ crystal‚ stationery‚ fragrances and accessories. Through Tiffany and Company and other
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