Disclosure Analysis Paper

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Disclosure Analysis
ACC/422
December 3, 2012

Disclosure Analysis
Under the full disclosure principle, companies are mandated to disclose financial information to be in compliance with the Security Exchange Commission. The information presented pertains to events that have an impact on the company’s financial position and results (Accounting Tools, 2012). With this purpose in mind, this paper will provide financial information pertaining to Crown Crafts incorporated. The information presented will show an analysis related to the company’s cash, cash equivalents, receivables, and inventory. Also this information will include a list identifying the components of the business’s cash and cash receivables as well. Crown Crafts Incorporate was created in 1957. The company sells, designs, and distributes infants and toddler products. These products include items such as bedding, blankets, and other nursery accessories. To strengthen their business, the company’s management team implements an aggressive strategy to position the company to take a tremendous opportunity in the global market, resulting in the business acquiring a strong consolidated balance sheet. The cash and cash equivalents from Crown Crafts incorporated primarily comprise of highly liquid investments purchased with an original maturity of three months or less. For instance, the company’s consolidated balance sheet shows cash and cash equivalent at April 3rd, 2011 are $205,000 and at April 1st, 2012 shows a balance of $214,000 (U. S. Security and Exchange Commission, 2012). Also financial statements notes consider accounts receivables and account payables as cash and cash equivalents. For instance, according to the U. S. Security and Exchange Commission (2012), “a negative balance outstanding under its revolving line of credit is considered as cash. This is done because these amounts legally are owed to the company are ready for withdrawal upon a company decision” (Pg. 2). Allowances against...
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