actually perform better (as shown in the income statement). The second change that reflected better numbers in their statements was the inventories. They changed the way they kept its value (they used FIFO for domestic materials‚ while using LIFO for imported material). Then‚ they made a "LIFO liquidation"‚ that according to a small research we made‚ it’s a managerial move done to lower the COGS‚ thus‚ increasing the profit margin out of nowhere. The net effect of this change was a 2.4 million
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History of Fourth Directive Company law directives are published under the authority of the Treaty of Rome (Article 54(3) (g)). The council and the commission want to co-ordinate safeguard to protect the interest of member state and others‚ in such a way that these safeguard are become similar across the EU. The objective of EU is to convey a common market that allows freedom of capital‚ goods‚ persons and services between member countries. EU adopted so many directives which are dealing with accounting
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The Average Cost (AVCO) Method of stock valuation allows for the cost of units to be averaged over a period of time‚ making it possible for units issued (sold) to be priced at an average cost. Advantages Disadvantages 1. Makes no assumptions about how the goods are issued. 1. More challenging to calculate 2. Valuation of closing stock will be close to the latest price. 2. A new average must be calculated with every purchase 3. Average price is mainly affected by the amount bought at the
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IFRS vs. U.S. GAAP: Differences and Consequences of U.S. Adoption A Study of the Issue of Comparability Daniel Morey East Texas Baptist University Author Note This paper was prepared for managers and business owners who are concerned about the possible U.S. adoption of IFRS‚ and its effects on financial reporting and other effected areas. IFRS vs. U.S. GAAP: Differences and Consequences of Adoption A Study of the Issue of Comparability In the United States all publicly traded companies
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Problem 1 Units Cost per Unit Total Cost Production batch 1 4‚000 $10 40‚000 Production batch 2 60‚000 $14 840‚000 Production batch 3 40‚000 $16 640‚000 Production batch 4 36‚000 $20 720‚000 140‚000 2‚240‚000 Problem 2 One Percent: Net Receivables Percent W/O Allowance AMT Year End Net Receivables 742‚000 1% 7‚420 734‚580 Two Percent: Net Receivables Percent W/O Allowance AMT Year End Net Receivables 742‚000 2% 14‚840 727‚160 The more accurate allowance method
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are things like R&D and advertising costs. Inventory Costs Under IFRS‚ the last-in‚ first-out (LIFO) method for accounting for inventory costs is not allowed. Under U.S. GAAP‚ either LIFO or first-in‚ first-out (FIFO) inventory estimates can be used. The move to a single method of inventory costing could lead to enhanced comparability between countries‚ and remove the need for analysts to adjust LIFO inventories in their comparison analysis. Write Downs Under IFRS‚ if inventory is written down
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Additional Practice Problems for Midterm Exam Preparation of Multiple-Step Income Statement Zoomy Zombie Inc. manufactures a wide variety of children’s products including educational toys‚ safety products‚ and outdoor toys. Skellan Davis‚ the company’s controller‚ had to leave unexpectedly while preparing the 2011 financial statements. Prior to his departure‚ Skellan had calculated 2011 income from operations before taxes of $22‚850‚000 (total for all divisions). Additional events and transactions
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BSB110 ACCOUNTING TOPIC 13 REVISION LECTURE SAMPLE FINAL EXAM PAPER 2 HOURS FOR WORKING 10 minutes for PERUSAL ALL QUESTIONS ARE TO BE ANSWERED ON THIS EXAM PAPER MARKS FOR EACH QUESTION ARE INDICATED DO NOT REMOVE OR TEAR ANY PAGES FROM THIS BOOK. WRITE YOUR ANSWER TO EACH QUESTION ONLY IN THE SPACE PROVIDED. QUESTION 1 (a) ‘Cash flows‚ cash flow from operations‚ operating profit - what is the difference?’ Explain in point form‚ the difference
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The annual reports of Wal-Mart and Target are provided free of charge via walmart.com and target.com. Upon inspection‚ the Wal-Mart and target reports include meaningful financial statements‚ including the Statement of Owners Equity‚ Income Statement‚ and Balance Sheet. These statements were obtained through 10-K statements available on walmart.com and target.com. In comparing the statements of these companies‚ Wal-Mart and Target both provide multi-step Statements of Operations‚ which include the
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Basic Objectives To allow better allocations of Capital market Ressources(Useful to those making invest and credit decisions ( Provide info: economic resour‚ claims and changes Fundamental Concepts Relevant - Past‚ Present‚ Future Events ( Reliable - Dependable‚ Reasonably Free Of Error ( Verifiable ( Comparable to other entities ( Consistent over time Recognition And Measurement Concepts Economic entity ( Going concern ( Monetary unit ( Periodically Basic Principles Historical
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