list of items that could be included in the intangible assets section of the balance sheet. Instructions (a) Indicate which items on the list would generally be reported as intangible assets in the balance sheet. (b) Indicate how‚ if at all‚ the items not reportable as intangible assets would be reported in the financial statements. 1. Investment in a subsidiary company. 2. Timberland. 3. Cost of engineering activity required to advance the design of a product to the manufacturing
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Off balance sheet financing is financing from sources other than debt or equity offerings‚ such as joint ventures‚ research and development partnership and operating leases. For complex institutions such as banks‚ they increase their use of off shore subsidiaries and swap transactions to avoid disclosing liabilities. In other words‚ off balance sheet accounting is a process which a business creates what is practically a debt that it must pay off‚ but the debt is accounted as another type of transaction
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-Starbucks Corporation and the use of “Off-Balance Sheet” Financing Starbucks Corporation‚ founded in 1985 in Seattle‚ Washington‚ purchases‚ roasts and sells whole bean coffees at retail locations worldwide. Starbuck’s in-store products include brewed coffees‚ espresso beverages‚ blended beverages‚ complimentary food items‚ teas and brewing equipment. At the end of 2009‚ Starbucks operated through 7‚ 803 retail locations in 49 countries (Annual Report 4). In recent years‚ Starbucks’s stock
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6. A proforma cost sheet of a company provides the following particulars : Elements of Cost Material 40% Direct Labour 20% Overheads 20% The following further particulars are available: (a). It is proposed to maintain a level of activity of 2‚00‚000 units. (b).Selling price is Rs.12 per unit (c) Raw materials are expected to remain in stores for an average period of one month (d) Materials will be in process‚ on averages half a month. (e) Finished goods are required to be in stock for
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Off Balance Sheet Financing Practices [Student Name] [Course Title] [Instructor Name] [Date] Off Balance Sheet Financing Practices The traditional accounting methods have been replaced by a number of new accounting techniques. Some of which are observable while other remain hidden. Off Balance Sheet Financing or OBSF is one of these new accounting techniques. It is a mode of obtaining finance for a business without disclosing significant capital expenditures on the balance sheet of a company
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The Effect Of Off Balance Sheet Financing In Failure Of Lehman Brothers Off Balance Sheet Financing: Off balance sheet financing is an accounting method whereby companies record certain assets or liabilities in a way that keeps from appearing on the balance sheet. Example: Supposed that company A has an operating lease on land on which company A has to pay £25‚000 per annum for the next 50 years. But due to nature of lease and IAS17‚ which allow Company to record yearly rental expense‚ but IFRS
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A balance sheet‚ like a photo‚ provides a financial picture of a company on a given day and time. It categorizes all of a company’s resources as assets‚ all of its debts as liabilities‚ and all of the owner’s investments as equity. A company uses its assets‚ such as accounts receivable‚ inventory‚ and equipment‚ for manufacturing or purchasing products for sale or to provide a service. A company’s assets are financed by its liabilities (debt) and the owner’s equity (net worth). On a balance sheet
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A balance sheet is a financial statement that reports the assets‚ which are resources owned by a business‚ liabilities‚ and stockholders’ equity at a specific date. Examples of assets would be computers‚ delivery trucks‚ furniture‚ and buildings. A balance sheet has two categories: Assets‚ liabilities‚ and stockholders’ equity. Liabilities are the debts and obligations of a business. Liabilities represent c claims of creditors on the assets of business. Examples of liabilities would be notes
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Example Company Balance Sheet December 31‚ 2011 ASSETS LIABILITIES Current Assets Current Liabilities Cash $ 2‚100 Notes Payable $ 5‚000 Petty Cash 100 Accounts Payable 35‚900 Temporary Investments 10‚000 Wages Payable 8‚500 Accounts Receivable - net 40‚500 Interest Payable 2‚900 Inventory 31‚000 Taxes Payable 6‚100 Supplies 3‚800 Warranty Liability 1‚100 Prepaid Insurance 1‚500 Unearned Revenues 1‚500 Total Current
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COURSE 2 - The Balance Sheet The balance sheet (also called statement of financial position) reports the financial position of the business at a point in time. It does so by listing the categories and amounts of assets‚ liabilities and equity on a specific date‚ in a format that proves the fundamental accounting equation. ASSETS = EQUITY + LIABILITIES or ASSETS – LIABILITIES = EQUITY Formats of presentation Regardless of
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