issue of revenue recognition practices is an area that has received a lot of attention from regulators. Whenever there is a report of financial restatements or negative earnings‚ regulators pay extra attention to review the financial statements in order to verify that that there are not any indications of financial fraud or that the organization overstepped their boundaries in the area of managed earnings. The reason that regulators have taken a special interest in financial accounting and potential
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The revenue recognition principle is a foundation of accrual accounting and one of the main principles of GAAP. The revenue recognition principle is a set of guidelines that helps accountants to identify when a revenue event has taken place and how to appropriately record cash exchanges before‚ during‚ and after the revenue event. According to the revenue recognition principal‚ revenue must (1) be realized or realizable and (2) earned‚ in order to be recognized. According to the SEC revenue is realized
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A: The primary criteria the auditor should use in determining revenue to be recognized are: (1): persuasive evidence of an arrangement exists. (2): Delivery has occurred or services have been rendered. (3): The seller’s price to the buyer is fixed or determinable. (4): Collectability is reasonably assured. The most basic principle for revenue recognition is revenue has been realized or realizable and earned. B: (1) a: Multiple deliverable. Does the software and one year internet service has
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Pacific-Basin Finance Journal 23 (2013) 1–24 Contents lists available at SciVerse ScienceDirect Pacific-Basin Finance Journal journal homepage: www.elsevier.com/locate/pacfin The role of the audit committee and the informativeness of accounting earnings in East Asia Tracie Woidtke a‚ Yin-Hua Yeh b‚⁎ a b Department of Finance‚ Corporate Governance Center‚ University of Tennessee‚ United States Graduate Institute of Finance‚ National Chiao Tung University‚ 1001 Ta-Hsueh Rd.‚ Hsinchu
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Biovail Case‚ Question 1 1. How many truckloads of product are actually required to carry $10 million of product? Show your calculations. Given: a. 1 Wellbutrin XL tablet is estimated to be 1.5 cm3 (this includes the packing space) b. A 18-wheeler trailer dimensions are: 17m x 4.5m x 2.5m Since the tablet and the trailer are using different units of measurements we need to convert the trailer dimensions to centimeters before we can calculate the volumes. To convert meters into centimeters
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Contents 1.0 INTRODUCTION Biovail Corporation was one of the Canada’s largest pharmaceutical publicly traded companies which expert in the development and large scale of manufacturing of pharmaceutical products. Biovail Company engaged activities on enhance formulate of the existing drugs‚ clinical testing‚ manufacture and commercial pharmaceutical products and utilized advanced drug delivery technologies. In the case‚ on September 30‚ 2003 there was a truck carrying a shipment of Wellbutrin®
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BIOVAIL CORPORATION • REVENUE RECOGNITION There are two possible FOB contract structures mentioned in the case‚ namely FOB shipping point and FOB destination. FOB shipping point means that Biovail would have recognized the revenue the same day it shipped as the sales arrangement was satisfied‚ service rendered‚ and a determinable sales price established. Conversely‚ FOB destination would not have allowed Biovail to recognize the revenue until the shipment reached the distributer. In such a
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Revenue Recognition Policy (Note 2): A. Sale of goods Revenue Recognition According to the annual report ’s financial statement notes‚ CV Technologies (CVT) recognizes revenue when the title of goods is passed on to the customer‚ and when reasonable assurance exists regarding the measurement and collection of the consideration given. This means that once CVT ships its goods to their reliable customers‚ they will account for those goods as sold‚ and recognize the contract amount as revenue. This
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ESTIMATING THE RISK PREMIUM USING HISTORICAL DATA: A CASE OF THE NSE Introduction This study seeks to estimate the risk premium of a company using historical data. Analysts use historical data to estimate the risk premium of a company’s equity. This is because the historical data is readily available from the company’s financial statements and the securities exchanges for example the Nairobi Stock Exchange (NSE) in Kenya. Historical market data can be used to compute average returns and a measure
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A family recently reached a settlement for injuries caused by a 2007 tractor trailer accident after seeking representation from a personal injury law firm in Texas. A family of three‚ injured in a Texas 18 wheeler truck accident near Chappel Hill‚ in Washington County‚ recently received a settlement of $435‚000 after being represented by The Carlson Law Firm (Cause No 2011-CI-00049). The suit was filed in the 150th Judicial District Court of Bexar County‚ Texas. According to the Texas personal injury
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