salaries expense‚ nonroster guaranteed contract expense‚ and roster depreciation expense. Then‚ he talked about roster depreciation‚ overstated player salary expense‚ and related-party transactions while meeting with the players. 1. How should Bill Ahern resolve each of the accounting conflict between the owners and the players? Bill Ahern should definitely work on making owners and players to understand the situation clearly. First‚ he needs to explain about the Roster depreciation that appears
Premium Major League Baseball
causes of disputes are roster depreciation‚ overstated player salary expense‚ and related party transactions. Roster Depreciation According to the owners the 50% of the 12 million dollar purchase price is being depreciated as roster depreciation. The reasoning behind the 50% rate of depreciation is that it is the maximum rate allowed by the IRS. This clearly shows that the owners are trying to cover as much profit without actual cash outflow through the depreciation expense. According to the
Premium Depreciation Balance sheet Generally Accepted Accounting Principles
Refer to the Kansas City Zephyrs reading from earlier in the week. For each of the 5 areas in dispute‚ answer the following: Who is right? Why? Submit your answers in your own Word document by the end of Week 1. Bill Ahem was asked to be an arbitrator in a major dispute regarding profitability between the Owner-Player Committee (OPC‚ the representatives of the owners of the 26 major League baseball teams in collective bargaining negotiations) and the Professional Baseball Players Association
Premium Major League Baseball
non-transparent accounting techniques. The points on which the dispute is centered‚ are: - The roster depreciation; - Players salary expense; - Related-party transactions-. I) The roster depreciation: The owners have allocated 50% of the purchase price to the value of the initial roster. capitalized and depreciated as a result of this value every 6 years. On the other hand‚ players‚ consider the depreciation is not admissible because most of them improve their skills through experience.
Premium Major League Baseball San Francisco Giants Baseball
accounting is being disputed: * Roster depreciation * Player compensation * Current Roster Salary - Deferred Compensation * Amortization of Signing Bonuses * Non-Roster Guaranteed Roster Expense * Transfer pricing of related party operations (stadium costs) Roster Depreciation 1. Who is Right? The Players 2. Why? The owners capitalized and amortized 50 percent of the purchase price ($12 million) simply because the tax rules allowed it; therefore the depreciation was spread over six years and
Premium Generally Accepted Accounting Principles Income
KANSAS CITY ZEPHYRS BASEBALL CLUB: A BASEBALL ACCOUNTING DISPUTE The controversy between the owners and players concerning how to account the expenses is crucial to understand if the company could be profitable and then able to meet players’ requirements. In this case three problems are under the scrutiny of the arbiter: roster depreciation‚ player compensation and the transfer pricing of related party operation‚ thus issues regarding the stadium cost. Players and owners are struggling against
Premium Depreciation Expense Money
so that the players will not have a substantial claim for more pay Major League: Made up of 26 Teams 14 American League‚ 12 National League Many teams do not own their own stadium or minor league teams Each team has 24 players on the active roster‚ 16 minor league players “on option” Each team plays 162 games (81 Home‚ 81 Away) There are 150 Minor League teams that are only partially funded by their affiliated Major League Team Team Owners established the Major League Agreement Major League
Premium Major League Baseball Minor league baseball Depreciation
City Zephrys Baseball Club‚ Inc. Case Study Issue: The PBPA believes the OPC should share with the baseball players the profits of the major league baseball teams Who is right? & Why? Roster depreciation Regarding roster depreciation‚ I would agree with the PBPA lawyer‚ Mr. Hanrahan‚ that depreciation expense should not be included in the income statement of the team since there are no plans on selling the equipment‚ only plans of sharing profits with the team players. Besides‚ experience can
Premium Major League Baseball Salary Baseball
baseball owners and players are: 1. Roster depreciation 2. Current roster salary 3. Amortization of signing bonuses 4. Non roster guaranteed contract expense 5. Stadium operations Who is right? 1. Roster depreciation: The owners The owners capitalized and amortized 50% of the purchase price over six years because that is the maximum percentage allowed by the Internal Revenue Code. I would argue that the value of the player roster is somewhat subjective. The players argument
Premium Major League Baseball San Francisco Giants American League
so that the players will not have a substantial claim for more pay Major League: Made up of 26 Teams 14 American League‚ 12 National League Many teams do not own their own stadium or minor league teams Each team has 24 players on the active roster‚ 16 minor league players “on option” Each team plays 162 games (81 Home‚ 81 Away) There are 150 Minor League teams that are only partially funded by their affiliated Major League Team Team Owners established the Major League Agreement Major League
Premium Major League Baseball Minor league baseball Baseball