LEDIIA CIIRKO LED A C RKO Date 25th May‚ 2011 BOSTON CHICKEN INC (CASE ANALYSIS) Questions 1. How is the company reporting on its performance and risks? What are the keys assumptions behind these policies? Do you think that its accounting policies reflect the risks? 2. What adjustments‚ if any‚ would you make to the firm’s accounting policies? 3. What questions would you ask management about the company’s performance? 4. How is Boston Chicken performing? 5. What assumptions is the market making
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Abstract A quality of earning assessment is a tool used by analyst to determine the correlation between accounting income and economic income. The techniques to analyze accounting income and economic income include: comparing accounting principles‚ reviewing changes in accounting principles‚ analyzing discretionary and warranty expenditures‚ understanding replacement cost of assets and managements and auditors opinion of the company. A quality of earnings assessment of PepsiCo is applied to
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Boston Chicken Case Boston Chicken was founded by Scott Beck in 1989 as a company that sold chicken along with sides as a home meal replacement with take out or dine in options. The management team that was hired was full of prior experience and success. The company went public in 1993 and their stock price went from $10 initially to $26.50. Their second public offering was in 1994‚ not nearly as successful as their IPO but they still managed to raise $105 million in capital. BC grew rapidly
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Osman Harac 300624875 Boston Automation Systems‚ Inc. 1. What is (are) Boston’s current revenue recognition policy (ies)? As of 1999 annual report‚ the company recognizes the revenue upon shipment. But this will change with SAB 101. The company will wait until the delivery and customer acceptance to recognize the revenue In addition to that they also calculate the estimated warranty costs. The company recognizes the service revenues as the services are provided (not before the services
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Under fair value accounting‚ earnings of a firm constitutes three broad components namely asset income‚ realized gains and unrealized gains. What impact does this have on a firm’s earnings quality given that the main shift from current accounting standards is the inclusion of unrealized gains into earnings computation? Often‚ it holds true that what matters is not how much a firm makes‚ but how it makes its money . Investors value earnings that are sustainable‚ inherent to a firm’s business and
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specifically related to realizing subscription revenue too early. An internal study‚ performed by the company’s new CFO‚ of other companies’ recent restatements shows that INVESTools’ impending restatement was most closely related to that of Red Hat Inc.‚ who also had to deal with accounting issues relating to subscription issues. Red Hat suffered a 23% drop in their stock price as a result of the news of its restatement‚ and everyone at INVESTools feared a similar fate. The CFO’s review revealed
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Quality Associates‚ Inc. Case Study Case Synopsis In this case‚ we have Quality Associates‚ Inc. a consulting firm advising its client about sampling and statistical procedures that can be used to control their manufacturing process. Their client has offered samples to be analyzed‚ so they can quickly learn whether the process is operating satisfactorily or corrective actions needs to be taken. The numbers given in the case were as follows: assumed population standard deviation is equal
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Ways to improve the earnings quality in acquisitions and mergers In recent years‚ acquisition and merger activities have boomed as result of improvement in economy and corporate earning. Along with the growing acquisitions and mergers‚ the risk of earnings manipulation and fraud embedded in related complicated transactions has also increased. From past experiences‚ three most common areas that have high risk of earnings management are research and development expenditure‚ restructuring costs
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Research Project on Organizational Structure and Design of Boston Pizza International Inc. Submitted To Dr. Ghassem Zarbi Master of Administrative Science (MAS) Theory and practice of administration (MADS 6600_V2) Fairleigh Dickinson University- Vancouver Campus Spring Semester‚ 2015. Prepared by: Chenqu Zhang Eman Ahmed Latha Dabir Naresh Shivakumar
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CHAPTER 11 Earnings Management 11.1 Overview 11.2 Patterns of Earnings Management 11.3 Evidence of Earnings Management for Bonus Purposes 11.4 Other Motivations for Earnings Management 11.4.1 Other Contracting Motivations 11.4.2 To Meet Investors’ Earnings Expectations and Maintain Reputation 11.4.3 Initial Public Offerings 11.5 The Good Side of Earnings Management 11.5.1 Blocked Communication 11.5.2 Theory and Empirical Evidence of Good Earnings Management
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