ACC 291 GENIUS Perfect Education

ACC 291 Entire Course and Final Guide
FOR MORE CLASSES VISIT
www.acc291genius.com
ACC 291 is a online tutorial store we provides ACC 291

Entire Course And Final Guide You can find here
7 How should mixed costs be classified in CVP analysis?
What approach is used to effect the appropriate
classification?
According to our class materials all mixed cost must be
classified into their fixed and variable and variable
elements. The method that can be used to determine is
called the high/low method. To determine the variable
cost the analysis takes the total cost and divide it with
the low activity level. To get the fixed cost then the
company would have to subtract the total variable with
either the high or low activity level.
9. Cost volume profit CVP analysis is based entirely on
unit costs. Do you agree? Explain.
In my opinion when it comes to making financial
decisions for the company, often times more than one
method is used. Cost volume profit is also based on
Volume or level activities, unit selling prices, variable
cost per unit, total fixed and sales mix.
14. You can find the break point in dollars by drawing a
horizontal line to the vertical axis. I you want to find
the break even point in units it will be a vertical line
from the break even point to the horizontal axis.
-----------------------------------------------------------
ACC 291 Final Exam Guide (New)
Discussion Question 1:
Based on what you know about accounting, what role

do you see it playing in business operations? How
dependent do you think a business is on its accounting
department? Why?
Accounting plays many important roles especially when it
comes to business operations. Accounting is mainly
responsible for almost all of the financial needs of the business.
It keeps track of all spending, profit and loss that the company
inquires. Axia College Material
Appendix C
Budgets Matrix
Directions: Using the matrix, define each of the budgets listed and briefly describe its uses.
Budget Definition Desc
Sales budget Estimate of the expected sales for The sales budg
the period. All of the other budgets units. This will
depend on the sales budget. This is see how many
where all the other budgets will produced for th
start from
Production budget A production of units needed to be Shows manage

produced in order to meet the will be produce
projected sales period and wha
to fulfill invent
Direct materials budget Is the estimated quantity or cost of Shows manage

the raw materials that is needed in materials that
order to produce the units required and or that nee
to fulfill inventory meet inventory
Direct labor budget A estimate of cost and quantity of Shows how ma

direct labor needed in order to laborers neede
meet production units for that b
Management w
be the right am
needed and if t
able to meet th
Manufacturing overhead budget An estimated expected amount of This list all ove
manufacturing cost for the budget cash disbursem
period
Selling and administrative expense budget Anticipated selling and Shows area of b
administrative expenses in the are not listed o
budget period manufacturing.
marketing, pro
the budget per
Budgeted income statement Estimate of expected profitability of Is a very impor

operations in a budget period shows the com
for the budget
Cash budget A projection of expected cash flows Cash budget he

in and out of the business. keep a tally or
balances.
-----------------------------------------------------------
ACC 291 Final Exam Guide 1
we have another New set of Final Exam Guide which could be found
on this link
Financial Statements
Discussion Question 1: Post your response to the following:
You know how important it is to create budgets for your

household. How does budgeting help management make good
business decisions?
Budgeting is a very important skill that can be applied to everyday

life and also when it comes to making good business decisions. I
really like the way our class resources says about Budgeting.
Budgeting is used as a planning tool used by management to make
good decision for the company. If a company is successful than more
than likely that means that the management team is very good at
managing the company finances. Budgeting helps management plan
ahead, defines what is most important, shows warning signs, reach a
company target without over or under budgeting and etc.
Another response
In a business, a budget helps a business make good decisions because

they are used by the company to plan for future events and coordinate
the events and duties in the company. They also gives objectives used
to evaluate the performance of the company on each level which can
help to make future decisions that will not hurt the company based on
the projected objectives. It can also be used to alert the company of
possible problems or negative trends in the company that need to be
addressed so that there is a clear picture of the overall health of the
company before decisions are made. The budget helps the company to
be able to make an informed decision when making one. It is there in
order to make sure that making a decision like taking on another
company will not hurt the company and is something that the
compnay can sustain based on the budget.
DQ2
Discussion Question 2: Post your response to the following:
What are some of the different types of budgets?
Describe in detail one type of budget covered in the text.
Describe what the budget is used for and what information it

provides a business.
Then, as you respond to your classmates, discuss how the
budget you described relates to the budgets they described.
Discuss how a business benefits from each of the budgets.
There are many different types of budgetting. For example, there sales
budget which allows management to see how many units that need to
be produced, production budget which will allows everyone to see
how many units are going to be produced in or needed to be produced
in order to meet the inventory for that budget period. One budget that
I can describe in detail is called the direct labor budget and this
budget shows how many people, hours is needed in order to meet the
required budget for that period. This will give management an idea of
how much money is needed such as paying the cost of labor. The
company benefits by each of these budgets because it will help
manage just how much money it will cost the company during this
period. Management can also see if there are different ways to cost
the company out of pocket cost down during this period.
Another response
I chose to write about the Production Budget. The Production Budget

shows the cost of each unit needed to produce an item or manufacture
a product. The formula used by the Production Budget :
Budget sales units + Desired ending finished goods units - Beginning

finished goods units = Required production units.
An example would be, every Easter the bakeries in the Bronx loads up
on Hot Cross Buns. My mother and grandmother would buy these
tasty sweet breads,and eat them for breakfast. I personally would like
to eat them every week but, they are only sold during the Easter
season. Maybe, it has something to do with the glazed cross on the
top.
Every Easter Holiday, there appears these Hot Cross Buns and the
bakeries production department allows for the purchases for items
needed to make the buns. After Easter has gone, Hot Cross Buns are
not included in the budget.
-----------------------------------------------------------
ACC 291 Final Exam Guide
ACC 291 Final Exam Study Guide
Question 207
On January 1, a machine with a useful life of five years and a
residual value of $40,000 was purchased for $120,000. What is the
depreciation expense for year 2 under the double-declining-balance
method of depreciation?
IFRS Multiple Choice Question 01 What is a Flexible

budget?
A Flexible budget is a budget that change

or is flexible during different levels or activity.
Unlike the static budget which is a budget based
on one activity level, the flexible budget is based
off of more than one activity level.
The steps to development a flexible

budget is :
a) Identify the activity index, and the range of

activity
b) Find out what the variable cost, and

determine the variable cost per unit
c) Find out what the fixed cost and determine

the budgeted amount for each unit
d) Organize the budget for selected additional
activity within the appropriate range
The information found on a flexible

budget cannot begin with the master budget.
The flexible budget uses the same guidelines the
original budget. The budget consists of Sales,
Cost of Goods Sold, Selling Expenses, General
and Administrative Expenses, Income Taxes, and
finally the Net Income.
The information on the budget is a great

tool to be used for evaluation performances. The
flexible budget can be used for monthly
comparison purposes. Also during the process
that management is identifying the activity index
and the range of activity it will allow them to see
the cost of direct labor hours for that budget
period.
-----------------------------------------------------------
ACC 291 Week 1 Assignment Comparative Analysis Problem
Purpose of Assignment The purpose of this assignment
is to help you understand the basics of financial
statement analysis using financial ratios on the assets
section of the balance sheet, data interpretation, and
how ratios are used to gain insight about the
management of receivable Capstone Discussion
Question: Post your response to the following:
Think back over what you have studied and
learned in this course. Do you have a new perception of
or appreciation for the field of accounting and how it
contributes to business? Explain.
To be perfectly honest with you I truly had no clue what
accounting did for a company and how important it
was. I always thought that accounting only dealt with
payroll. In fact accounting does much more that just
payroll and monitor company supplies (coffee, paper,
pens & pencils). The accounting sets budgets for the
entire company, monitors outflow and inflow of profits,
plans budgets for each department, and much more.
When I first begun this class I was really nervous, I truly
thought that I was going to have a hard time
understanding the accounting but I happy to say that I
was wrong. I understood every part of this course.
On a personal note I would like to thank you Jess. If it

wasn't for your pep talk I probably would had gave
up. You are truly a great instructor. I wish you all the
best! God Bless
Another response
Accounting has taken a whole new meaning to me in
my vocabulary. Prior to this course, I just took
accounting as a calculator and crunching numbers. I
now have a new respect for accounting and all the
aspects that are involved. I never once took into
consideration profit, sales, revenue, and balance
sheets also being included with accounting. There is so
much more involved with accounting, and had I not
taken this course I would have never known.
Accounting is a very important part of running a
business. I feel that it is imperative to all people
thinking of opening a business should take some type
of accounting class to become more aware of how to
run the accounting part of a business.
-----------------------------------------------------------
ACC 291 Week 1 Discussion Question 1
How would you describe the entries to record the disposition of
accounts receivables?
Business Plan
By
Kamilah T. Crooms
The name of my business is called DestinyWear. DestinyWear is
a urban fashion clothing company for woman, men and youth.
DestinyWear specializes in making clothing for every occasion. My
name is Kamilah Crooms and I am the owner and CEO of
DestinyWear.My goal is to ensure that my company will be succesfull
in all areas and in each department. In order for me to make sure that
the company was going to begin in the right direction I had to
priortize what was most important in establishing my business plan.
The main priority is that I had to first choose the appropriate
business structure, a high demanding product, and most of all an
outstanding accounting team.
Business Structure
Upon establishing DestinyWear I had to decide which business
struture that I felt was best for me to pursue. I decided that as a
Entreprenuer the best choice for me abd the direction of the company
would be for me to be sole proprietorship. Sole proprietorship
allowed me to be the sole owner of DestinyWear. The first and most
important reason that I wanted sole proprietorship is because it is
much easier to start a business as sole proprietorships. Sole
proprietorship takes all the profit that and doesn't have to split it
between any other owners or corporations. I also want the power to
make and change decisions along the way without having to first
consult anyone else.
DestinyWear Products
DestinyWear products will range from jeans, shirts, accessories and
shoes. The company will first start off with its most profitable product
and that will be the DestinyWear designer jeans line. The jeans line
has over twenty different jeans designs
from straight leg, baggy, cargo, overalls, shorts and much more. The
jeans line will provide services within the United States and Canada
and will eventually service International customers. The DestinyWear
jeans line will have its own building. In this building the bottom floor
will consist of the factory and the top floor will have the different
departments such as management, marketing and most importantly
the accounting department.
DestinyWear Accounting Department

The accounting plays a major role in establishing my company
DestinyWear. The accounting department does more than managing
and reporting the companys financial documents it is the greatest
tool in establishing my business. The key to a powerful accounting
department here at DestinyWear is applying the principles of internal
control. These principles consist of establishment of responsibilities,
segregation of responsibilities, documentation procedures, Physical,
mechanical, and electronic controls, Independent internal verification
and other controls such as Bonding of employees. In order to ensure
that this business plan works DestinyWear has to hire nothing but the
best qualified employees.
DestinyWear Accounting Staff

DestinyWear accounting team of fine employees will all be hired
through the company. There are several requirements that have to be
met in order for myself as the owner and Human Resource
department to even consider the applicant for accounting. We looked
for characteristics, education and work history experience. The first
and far most important qualifying requirements are education. The
applicant has to have a Bachelor BA/BS in accounting degree a plus
if he or she has a masters.
The second requirement is experience. The applicant must have the
minimum of five years of experience working in accounting. He or
She must have knowledge and employment experience of working
with financial statements, cash management and internal control.
Employees must be experienced in Invest idle cash, planning the
timing of major expenditures, delay payment of liabilities keeping
inventory levels low, and increasing the speed of collection on
receivables. In the category of experience we had to hire applicants
according to the position that had to be filled in accounting. For
example, if a position in accounting such as management or
supervisory needed to be filled, then we would look for years of
experience in management or supervisory positions. I personally
prefer that every employee have some type of management
experience.
Last but not least, the employees characteristics. It is a must that
every accounting staff member has and applies professionalism, great
ethic and moral skills, accuracy, and most importantly punctuality,
and reaching company deadlines. These characteristics are very
important to have at DestinyWear.
DestinyWear Accounting Management Team
The DestinyWear accounting management team will be
reporting to me and to the other head staff each week to report
updates and any new changes. The management team is responsible
to have all the different types of budgeting reports that includes Sales,
Labor, etc. Management must follow the responsibility reporting
system for each department. The managers will use the companys
financial information to predict outcomes of the business. I require a
report from each responsibility center, cost center, profit center and
investment center to be reported each month. Management is
responsible to ensure that the company does not over or under budget
and if any changes it must be reported immediately.
Conclusion
DestinyWear will be a very successful team not only because of
the products that we produce but because of having a great
accounting team. With the help of accounting team I DestinyWear
products will be in every wardrobe in America.
REFERENCES
//http:yourdictionary.com /CVP.org Retrieved 3/20/2010
Thomas, Y. 2005-08-27 Accounting 101 pg. 52 Statements.
March 19, 2010
Drucker, P. Managing in the next society 2002. retrieved march
19,2010
-----------------------------------------------------------
How are bad debts accounted for under the direct write-off method?
Costco Wholesale Corporation

If we look at the financial statements of the company we can find that
the company is financially strong. Its strength are:
1. It has enough amount of current asset to repay its current
liability. The current ratio of the company 8.18 indicates that
the company has $8.18 liquid asset to repay its $1 of current
liability.
2. The operating cost of the company is increasing because the
company is able to reduce its expenses.
3. Cash from operating activity has increased for the company.
Apart from this strength the company also has some weakness in its
financial statement:
(i) Increasing inventory indicates that the company inventory
conversion period is increasing.
(ii) The cash from investing activity shows that the company cash
outflow is more in the short term investment i.e. in non
operating activity.
(iii) The overall has for the year 2008 has declined for the
company.
Net Income:
Net Income
$1,300,000
$1,250,000
$1,200,000
$1,150,000 Net Income
$1,100,000
$1,050,000
$1,000,000
$950,000
2006 2007 2008
If we look at the trend in net income of the company we can find that
the company net income looks fluctuating but it has improved it net
income in 2008 as compared to 2007.
Debt ratio as a percentage of total assets:
Debt ratio as percent of total asset

55.80%
55.70%
55.60%
55.50% Debt ratio as percent
55.40% of total asset
55.30%
55.20%
55.10%
55.00%
54.90%
2007 2008
If we look at the debt ratio as percent of total asset we can find that
the debt ratio is declining in 2008 as compared to 2007 i.e. the
company is increasing equity to finance debt.
Debt as a percentage of total equity:
Debt as percent of total equity
127.00%
126.50%
126.00%
125.50% Debt as percent of
125.00% total equity
124.50%
124.00%
123.50%
123.00%
122.50%
2007 2008
As we can see that the debt as percent of total equity is declining in

2008 as compared to 2007 i.e. the company is increasing equity in its
capital structure.
As we can see that there is nothing negative in 2008 for the company
and this is the reason it has positive trend as compared to 2007.
Hence there is no need to correct anything for the company.
-----------------------------------------------------------
ACC 291 Week 1 Wileyplus Assignment E8-4, E8-11, BYP8-

1, and BYP8-2 (New)
Wiley Plus Assignment Week 1
E8-4, E8-11, BYP8-1, and BYP8-2 in MS Excel
Exercise 8-4 Wainwright Company
Exercise 8-11 Fedex Corporation

Week 1 DQ 1
Due Tuesday, Day 2
Go to the U.S. Securities and Exchange Commissions Web site

at http://www.sec.gov and the Financial Accounting Standards
Boards Web site athttp://www.fasb.org. Identify the mission and main
activities of each organization. Then, analyze the similarities and
differences between the roles of each entity. Which entity has more
influence over financial statement reporting? Explain your answer.
According to the SEC website their mission is to protect investors,
maintain fair, orderly, and efficient markets, and facilitate capital
formation. The SEC also requires public companies to disclose meaningful
financial and other information to the public. This provides a common pool
of knowledge for all investors to use to judge for themselves whether to
buy, sell, or hold a particular security. The SEC is concerned primarily with
promoting the disclosure of important market-related information,
maintaining fair dealing, and protecting against fraud.
According to the FASB website the mission of the FASB is to establish and
improve standards of financial accounting and reporting that foster
financial reporting by nongovernmental entities that provides decision-
useful information to investors and other users of financial reports. Since
1973, the Financial Accounting Standards Board (FASB) has been the
designated organization in the private sector for establishing standards of
financial accounting that govern the preparation of financial reports by
nongovernmental entities
The major difference in the SEC and the FASB is that the SEC deals with
reporting of financial statements for all industries while the FASB deals
mainly with the private nongovernmental entities. Both are concerned with
the fairness of financial reports and work in the interest of the public. I
believe that the SEC has more influence over financial statement reporting
because they can bring civil action against companies and individuals for
violations of securities laws. Although according to the FASB website, the
Commissions policy has been to rely on the private sector for this function
to the extent that the private sector demonstrates ability to fulfill the
responsibility in the public interest.
Response 2
Go to the U.S. Securities and Exchange Commissions Web site
at http://www.sec.gov and the Financial Accounting Standards Boards Web site
athttp://www.fasb.org. Identify the mission and main activities of each
organization. Then, analyze the similarities and differences between the roles of each
entity. Which entity has more influence over financial statement reporting? Explain
your answer.
U.S. Securities and Exchange Commission (SEC)
According to the SECs website The mission of the U.S. Securities and Exchange
Commission is to protect investors, maintain fair, orderly, and efficient markets, and
facilitate capital formation(U.S. Securities and Exchange Commission, 2010, Para.
1).
The main activities of the SEC are to interpret federal securities laws; issue new
rules and amend existing rules; oversee the inspection of securities firms, brokers,
investment advisers, and ratings agencies; oversee private regulatory organizations in
the securities, accounting, and auditing fields; and coordinate U.S. securities
regulation with federal, state, and foreign authorities. (U.S. Securities and Exchange
Commission, 2010)
Financial Accounting Standards Board (FASB)
According to the FASBs website The mission of the FASB is to establish and
improve standards of financial accounting and reporting that foster financial reporting
by nongovernmental entities that provides decision-useful information to investors
and other users of financial reports. That mission is accomplished through a
comprehensive and independent process that encourages broad participation,
objectively considers all stakeholder views, and is subject to oversight by the
Financial Accounting Foundations Board of Trustees (Financial Accounting
Standards Board, n.d., Para. 3).
The main activities of the FASB are to identify financial reporting issues based on
requests/recommendations from stakeholders or through other means. The FASB
Chairman decides whether to add a project to the technical agenda, after consultation
with FASB Members and others as appropriate, and subject to oversight by the
Foundation's Board of Trustees. The Board deliberates at one or more public meetings
the various reporting issues identified and analyzed by the staff. The Board issues an
Exposure Draft to solicit broad stakeholder input. (In some projects, the Board may
issue a Discussion Paper to obtain input in the early stages of a project) The Board
holds a public roundtable meeting on the Exposure Draft, if necessary. The staff
analyzes comment letters, public roundtable discussion, and any other information
obtained through due process activities. The Board redeliberates the proposed
provisions, carefully considering the stakeholder input received, at one or more public
meetings. The Board issues an Accounting Standards Update describing amendments
to the Accounting Standards Codification (Financial Accounting Standards Board,
n.d.).
Both the SEC and the FASB have the same goals of fairness, accuracy,
and understandability of financial accounting and reporting. Both
agenecys accomplish these goals in the best interest of the overall public.
The differences between the SEC and the FASB is that the FASB regulates
financial reporting in the private sector of businesses (but are subject to
the rules and regulations of the SEC) and the SEC deals with regulating the
financial reporting of publicly held corporations.
I believe that the SEC has the greatest influence over financial
statements reporting because they have the final approval on all changes
of the rules and regulations. The Sec can also bring civil or administrative
enforcement actions against individuals and companies in violation of the
securities laws.
References
Financial Accounting Standards Board. (n.d.). Facts about FASB. Retrieved
July 15, 2010, from Financial Accounting Standards
Board:http://www.fasb.org/facts/index.shtml#mission
U.S. Securities and Exchange Commission. (2010, May 3). The Investors
Advocate: How the SEC Protects Investors, Maintains Market Integrity, and
Facilitates Capital Formation. Retrieved July 15, 2010, from U.S. Securities
and Exchange Commission: http://www.sec.gov/about/whatwedo.shtml
Week 1 DQ 2
Due Thursday, Day 4
Search the Internet or the Online Library for information about the
Sarbanes-Oxley Act. A useful guide to some of these provisions is
located at http://www.soxlaw.com. Summarize at least two provisions
of the law, and discuss your interpretation of these provisions with
your classmates. Do you think this law will make financial statements
more reliable? Also, discuss how Sarbanes-Oxley establishes
boundaries to ensure ethical practices. What does the law allow or
prohibit, and why?
The Sarbanes-Oxley act has many provisions to give companies

guidelines for responsible, and ethical financial reporting. One of
those provisions is listed in Section 302 of the act. The provision is
that periodic statutory financial reports be certified that signing
officers have reviewed the reports, the report does not contain any
untrue, or misleading information. The financial statements fairly
present the financial condition. The signing officers are responsible
for internal controls. A list of all deficiencies in internal controls, and
a list of fraud involving employees, and anything that could negatively
affect the internal controls.
Another provision pertains to the "management assessment of

internal controls". This provision ensures that information is
published in annual reports regarding the adequacy of internal
controls, structure and procedures.
The Sarbanes-Oxley act is designed to help companies promote

ethical accounting procedures. The act gives guidelines as to how
financial statements are reported. The act requires verification that
officers within the company have checked the information in the
reports for accuracy and true. The act also requires that the
companies have internal controls in place to ensure ethical reporting
practices. The main thing that the Sarbanes-Oxley promotes is
transparency in reporting.
Response 2
Section 802 of the Sarbanes-Oxley Law defines the penalties that
may be assessed against individuals who failed to comply with the
Act. An individual could be subject to 20 years in jail for altering,
destroying, mutilating, concealing, falsifying records, documents or
tangible objects. Guilt is define by the intent to impede a legal
investigation. This part of the law gets to the heart of how Arthur
Anderson reacted by destroying documents important to Worldcom.
The law further defines that any accountant who knowingly violates
their ethics by wilfully violates the requirements of maintenance of all
audit or review papers. These papers are subject to review up to five
years.
The second Section that I reviewed was the Section 302. This
actually is my favorite part of the law because it directly holds the
officers and directors accountable for the accuracy of reporting in
their financial statements. It defines that the management must
review and understand the financial statements and sign that they
are true and accurate. It also holds the management accountable for
the internal controls, requiring any deficiencies to be reported. In the
past directors of companies relied heavily on the internal officers,
management, to report the company performance without
questioning the accuracy or taking their role on oversight committees
seriously. They could hide behind a veil of trust of the key leaders.
This Section clearly puts the responsibility for the Board to remain
independent of the executives and function more effectively on the
respective oversight committees they serve. The example I would
share is what happened in WorldCom. The company leaders shared
what they wanted to with the Board, who trusted implicitly the top
leaders. Had they questioned their legal representation or auditors,
they potentially could have uncovered the fraud that was committed
by the creation of shell companies, with WorldCom employees as
stockholders.
I would love to think this law would protect the investing community.
Financial reporting has improved to some extent. Unfortunately the
scams still continue. Example would be Barney Madoff or what
happened in the financial mortgage industry. These unethical
practices were conducted after Sarbanes Oxley was implemented.
Madoff was able to provide false financial information to investors.
Financial industry was allowed to get to aggressive in underwriting
and product suite. Fines and penalties are deterrents. Ethics still
must be inherent in an individual and company. Laws and
requirements are a guide. There will never be enough auditors,
inspectors or oversight boards to catch all of the fraud in the
corporate community.
The law prohibits falsifying information, failing to notify of material

changes, and destruction of records.
-----------------------------------------------------------
ACC 291 Week 2 - Fordyce and Atwater (New)
P10-5A
Fordyce Electronics issues a $400,000, 8%, 10-year mortgage note

on December 31, 2007. The proceeds from the note are to be used in
financing a new research laboratory. The terms of the note provide
for semiannualinstallment payments, exclusive of real estate taxes
and insurance, of $29,433. Payments are due June 30 and December
31.
Lucent Technologies
Axia College of University of Phoenix
Lucent Technologies is a company based on networking for service
providers, government, and enterprises worldwide (Lucent
Technologies, n.d., Para 1). The products and services they work with
are separated into three categories; service and maintenance,
wireless mobility networking, and wire line networking. Lucent
Technologies is backed by Bell Labs, which does research and
development in networking technologies.
During the years of 2001 to 2003 this company has experienced a
decrease in demand because of other companies loss or capital used
toward spending. This is mainly due to a downturn in the economy. As
an investor this information is necessary to know because it explains
the decrease or increase in sections of the balance sheet. In order to
compare the growth or decline of the companys profit, an investor
must change a balance sheet into a common-size balance sheet. First
when looking at the balance sheet an investor will see that the amount
of paid in capital has increased from the year of 2003 to 2004, the
assets have increased, but the liabilities have decreased. When
running a debt/asset ratio it is noticed that this ratio drops from 1.2 in
2003 to 1.0 in 2004. This shows the companys risk is low when
concerning financial leverage, usually when the debt ratio is less than
one percent it is financed mainly by company equity, so this company
is close to being debt free from creditors.
After changing the balance sheet to a common-size balance sheet
there are several factors an investor will look at. The current assets
have dropped to .48 from .49 in 2004. This does not show harm to the
company because only the accounts receivable dropped while the rest
of the current assets increased. This means the company is not in as
much danger of default on money owed to it. It does have a rise in
marketable securities. The one concern in the assets is the increase of
prepaid cost of pensions and goodwill. Goodwill can be used for tax
breaks but prepaid pensions cannot benefit the company.
When looking at the liabilities section an investor will see a drop in
pension and liabilities and an increase in long term debt, both of
these could be affected because of the drop in the economy. Long term
liabilities are often increased to help a company control interest rate
increases so as an investor cutting back on pension liabilities cuts
back cost to the company and watching interest rate increase show
the company is concerned with its earning and investors. This would
be encouraging or an investor. The stockholders deficit shows a drop
in accumulated deficits from -1.43 to -1.22 and total deficits of -.26 to
-.08. This shows the company is working to control any money loss
and turning it to the companys advantage. Overall it shows the
company is still earning a profit although small. With an increase of
assets and a drop in liabilities the company is showing it is working
in a low risk capital.
After reviewing this information, a creditor or investor must be able
to compare this company to the industry totals. By comparing how
this company compares to other companies similar to it, a person can
see if it is competitive and worth taking a risk. Running ratios will
also show if the company is capable of paying off any debts it has or
if it can acquire the needed cash in case of emergencies. Overall as
an investor, I would say this company would be worth investing in.
Reference
Axia College. (2007). Understanding Financial Statements. Retrieved
May 10, 2010 from Axia College, Week 2 Assignment, ACC/230.
-----------------------------------------------------------
ACC 291 Week 2 Assignment Financial Reporting Problem,

Apple Inc
is to help you understand the basics of financial
statement analysis related to the assets section of the
balance sheet, data interpretation, and how financial
information is obtained to understand how a company
accounts for its long-lived assets. Assignment Steps
Resources: Financial Accounting:
Differentiating Depreciation Methods
There is one main difference between straight line

depreciation and accelerated depreciation. Straight line
is decided by taking the cost of the assets, figuring out
the salvage cost when the use of the asset is finished
and how many years of use the asset has. A person
then takes the cost minus salvage and divides the
remainder by the number of years of use. This amount
is the depreciation expense subtracted each year from
the cost. The accelerated depreciation does not have
the same amount of deprecation subtracted each year.
It does have the cost minus salvage value to figure out
the amount to use but is then divided out differently. A
person takes the sum of the years of a products useful
life, such as three years is 3 + 2 + 1 = 6, then a person
would divide the depreciation amount by 3/6 the first
year, 2/6 the second and finally 1/6 for the final year.
So the amount of depreciation expense is larger to
smaller with accelerated and equal amounts for
straight line.
The advantages of straight line method are it is easier
and faster to figure. The advantage of accelerated
method is it is more accurate when figuring
depreciation expense. The accelerated method has an
advantage and disadvantage concerning taxes. A
company can use the accelerated method to take
advantage of bigger tax breaks at the beginning of an
assets life, but since this amount drops during the
lifespan if the company needs added tax breaks it will
not receive them from these assets in the future. With
the straight line method the amount of tax breaks are
even through the life of the product. Most companies
choose this form of depreciation for reporting purpose
on taxes but will use the accelerated method to figure
taxable income.
As mentioned before the advantage of straight line
depreciation is it is easier to figure and uses the same
total each year for deduction of depreciation expense
but the disadvantage is that if use for taxable income
and reporting a company does not get a bigger tax
break at the beginning of the assets life when they
have just put out the cost for the item and may need a
bigger tax break.
-----------------------------------------------------------
What are the differences among valuation, depreciation, amortization,
and depletion?
Preparing an Income Statement
The companies net income is profitable when the sales exceed the
cost of goods sold. In this, the gross profit is $761k. This is beneficial
to the company. Though we took the cost of goods away from the net
sales there are still other areas which need to take a piece of the pie.
For this company, once the SG&A and depreciation are taken out, the
company still contains a profit of $290k. But the buck does not stop
there. Once the interest income and interest expense are adjusted the
balance before earnings and taxes is $290k. After taxes are taken out,
the company is left with a net profit of $174k.
In this case I think the company has achieved success with a net profit
of $174k. If the company were unable to be profitable, the company
would eventually go out of business. We would be able to tell if the
company was not profitable by looking at each section individually.
The cost of goods sold is what stands out for me. If we pay more to
make the product then we are actually selling it for, there is no profit
to be made. So, I think it should all start there.
-----------------------------------------------------------
What types of industries have unearned revenue?
Why is unearned revenue considered a liability?
Week 3 DQ 1
Due Tuesday, Day 2
Post your answer to Problem 3.5 on p. 109 (Ch. 3). How might the
information contained within the stockholder equity statement be used
for management and investor decision-making? Provide specific
examples of situations in which the stockholder equity information
might be used.
The statement of stockholders equity provides the changes in the

equity accounts during the accounting period more in depth than the
balance sheet. The information found on the statement of
stockholders equity includes retained earnings, common and
preferred stock, and additional paid in capital. Management uses the
statement of stockholders equity to ensure they are reaching their
goal of maximizing shareholder's equity. The use of market ratios
help with the analysis of the statement of stockholders equity, such as
earnings per share, price-to-earnings, dividend payout, and dividend
yield. These ratios will help both management and investors in
analyzing the company. For example, if I were looking to invest in a
companys stocks I would utilize all of the financial ratios, as well as
the market ratios. The earnings per share ratio is calculated before
the price to earnings ratio, P/E, because the earnings per share ratio
is used in the second. If a company pays dividends, the dividend
payout ratio will come in handy. It tells us The percentage
of earnings paid to shareholders in dividends (Investopedia, 2010,
p. 1).
References
Investopedia. (2010). Dividend Payout Ratio. Retrieved August 3,
2010, from
Investopedia:http://www.investopedia.com/terms/d/dividendpayoutrat
io.asp
Response 2
Explain what can be found on a statement of stockholders equity.
The major elements of stockholders' equity include capital stock,

paid-in capital, retained earnings, treasury stock, unrealized loss on
long-term investments, and foreign currency translation gains and
losses.
How might the information contained within the stockholder equity

statement be used for management and investor decision-making?
Provide specific examples of situations in which the stockholder
equity information might be used.
Management may look at the stockholders equity statement retained

earnings section to determine if company should borrow money for
capital investments or finance it through various forms of equity. It
may also be used by the stockholder to evaluate the compensation
paid to the company officers. Investors may also look at the statement
for cumulative net unrealized gains and losses before purchasing
stock in the company. Investors are also interested in the paid in
capital because they can compare it to the additional paid in capital
and the difference between the two values will equal the premium
paid by investors over and above the par value of the shares.
DQ 2
Week 3 DQ 2
Due Thursday, Day 4
Provide an example from the text or the Internet that demonstrates a

situation in which a companys net profits appeared good in the
statements, but the gross or operating profits presented a different
picture. Discuss how this might have occurred. Respond to the
following question, addressed in Problem 3.6 on p. 109 (Ch. 3):
Why is the bottom-line figure, net income, not necessarily a good
indicator of a firms financial success? Look for indicators like
liquidity or solvency to answer this discussion question.
An example that demonstrates the situation is Enron. Enrons

financial statements did not show all the expenses and costs. Instead
of showing them on the income statement they made entries so the
cost and expenses would post in the balance sheet. The same was
done with the revenues. This way it would be less expenses and the
net profit appeared good. Many debts and losses were not reported in
the financial statements. From the third quarter of 2000 through the
third quarter of 2001, the directors fraudulently used reserve
accounts within Enron Wholesale to mask the extent and volatility of
its windfall trading profits, particularly its profits from
theCalifornia energy markets; avoid reporting large losses in other
areas of its business; and preserve the earnings for use in later
quarters. By early 2001, Enron Wholesale's undisclosed reserve
accounts contained over $1 billion in earnings. The head of the
company improperly used hundreds of millions of dollars of these
reserves to ensure that analysts' expectations were met. In addition,
Skilling and others improperly used the reserves to conceal hundreds
of millions of dollars in losses within Enron's EES business unit from
the investing public.This would show the creditors that Enron was
making profits and its position was solid.
The net income is not necessarily a good indicator of a firms

financial success because the income statement only shows the profit
or loss at a period of time and does not show the whole picture of the
company. The Balance Sheet, Statement of cash flow, Statement of
shareholders equity and the Income Statement all together give the
real picture of the business. Each one of them shows different aspects
of the business. These statements show where the income is actually
coming from; is it from sales or from loans the company is
borrowing? If the company is selling a building or any other asset but
that does not mean that it is selling more products and making profit.
Looking at the Income Statements the company might be making
profit but at the same time it is extremely leveraged.
Response 2
A companys net income is not the whole picture, just part of it. There
are lots of things that contribute to the net income that may not be
significative to the companys success. If the value of a dollar has a
sudden change that can affect the bottom line if the company happens
to hold the medium of exchange that can benefit by the change that
might occur. The company can falsely inflate the bottom line. A
companys net income is coupled with liabilities, cash flow, and
selects financial ratios. Looking at it this way is a much better way of
seeing what the companys success is like. A company can change up
many things to make it look like their income is better. These things
that can be changed are single sales events, cash infusion, or false
financial statements. Some things like debt that a company has, the
companys cash on hand, their capital assets conditions, or even their
sales trends. To figure the success of the company, you must look at
the whole picture. One thing cannot tell you all the facts of the
companys affairs. You cannot tell the net income of the company just
from the bottom line. Look at all the financial records.
Response 3
Provide an example from the text or the Internet that demonstrates a
situation in which a companys net profits appeared good in the
statements, but the gross or operating profits presented a different
picture. Discuss how this might have occurred. Respond to the
following question, addressed in Problem 3.6 on p. 109 (Ch. 3):
Why is the bottom-line figure, net income, not necessarily a good
indicator of a firms financial success? Look for indicators like
liquidity or solvency to answer this discussion question.
Net income is not necessarily a good indicator of a firms financial
success because they have ways to manipulate it by increasing their
revenues or hiding some of their expenses. For investors trying to
decide where to invest their money, they need to look more into
assessing how the company came up with the numbers they
presented.
An example of this situation is when Laribee Wire Manufacturing Co.

exaggerated in recording their inventory value which allowed them in
acquiring loans from six banks totaling to about $130 million using it
as collateral. At the same time, they reported $3 million in net income
for the period, but in actuality they lost $6.5 million.
This company showed a higher net income by reporting fake

inventory in which its value was overstated and transferred over to
their income statement. When the banks assessed their financial
statements, it was enough to sway them into lending the loans they
needed.
Reference:
Investopedia. (2010). Spotting Creative Accounting On The Balance

Sheet. Retrieved
fromhttp://www.investopedia.com/search/searchresults.aspx?
q=Spotting+Creative+Accounting+On+The+Balance+Sheet&submi
t=Search
-----------------------------------------------------------
ACC 291 Week 2 Individual WileyPLUS Assignment Week

Two
we have another New set of week 2 Willeyplus assignment which
could be found on this link
For Discussion Question 1: Post your response to the following:

When reviewing a financial report, why should information
be reliable, relevant, consistent, and comparable?
In other words, why are these accounting characteristics

important?
What kinds of problems could be created if a financial
report is not reliable, relevant, consistent, or comparable?
It is extremely vital that the company has accurate financial
reporting. This information determines whether or not to invest in
your company's stock. This information will help them decide if it is
profitable to invest or not to invest in your company based what is in
your financial history. The information must be relevant because it
will help the company, investors and lenders make decisions. It
helps answer questions like, "how stable is your company", or
"what future does this company have". The information should be
reliable. In other words the information that is reported must be
able to be verified, backed up with truthful information.
Comparable occurs when different companies use the same
accounting principles. This makes it much easier to compare results
between company's. Consistency happens when the company uses
the same accounting method every year. When the financial
statements are reported each year, it paints a financial picture of
where the company is headed now and in the future.
What kinds of problems will occur if the information does not

include these things?
Falsified or manipulated statements doesn't only effect the company

but it also to name a few effects the lenders, creditors, investor's,
etc. This will result in the company not having a faithful
representation.
Another response
The main objective of generating financial information is providing
useful information that can be used in decision-making... only if
this information is relevant, reliable, comparable, and consistent,
can it be useful for decision makers. (Kieso, 2003).
Relevance gives a basis for making decisions that will impact the
future of a business, and it confirms and corrects expectations from
the past. If the information makes a difference in making
decisions, it is relevant.
Reliability means that the information can be depended on and it
can be proven to be free of error, and the information is factual.
The information cannot favor one set of users over another. CPAs
audit financial statements to ensure reliability.
Comparability is also an important characteristic of financial
reporting... this happens when different businesses use similar
accounting principles, making it much easier for one to compare
companies, and the method used in a business must be disclosed to
the users of the information to enable the users to convert the
information as accurately as possible.
Consistency simply means that the business uses the same
accounting principles on a yearly basis... consistently. This helps
decision makers analyze a company's trends. A company can
change the methods used if they can justify the change, showing
that the new method is more useful for analysis. If the method is
changed, it must be disclosed in the notes that go with the
statements to show users a lack of consistency.
These characteristics are very important to a business... decisions
cannot be made based on incorrect information, and everyone
involved in a business venture of any kind, whether they be
management, owners, or investors and creditors, as well as
consumers, etc. must be able to rely on the financial information
provided in order to make any type of decision. Without this
information, it is difficult to imagine any business succeeding, even
for a short time.
Examples of problems that could occur without reliable, relevant,
consistent, or comparable information includes not being able to get
loans or investments; management could make decisions that cause
irreparable damage to entire operations, consumers could easily
lose faith and cut their ties... the possibilities are endless for
companies that lack these qualities in their financial reporting.
DQ2
For Discussion Question 2: Post your response to the following:
How does information from financial reports influence
business decisions?
Why is it important for business managers to understand

the information found on financial reports?
How does information from financial reports influence business

decisions?
Once the information from the financial reports have been posted
then a team will review the company's financial history to see what
decision were profitable or not. The decisions that were made
previous to the financial reports being posted will show which way
the company needs to go to continue to remain #1.
Why is it important for business managers to understand the

information found on financial reports?
IT is extremely important for he business managers to understand

the information found on the financial reports. The business
managers are going to be the people that are going to make
decisions for the company. They need to know how to interpret the
financial reports and come up with different strategies that will
continue to make the company money.
Another response
The information from financial reports influences business
decisions because it shows where the company stands. The
managers use the information from the financial report compared
to the current year from the previous year, whether the company
growths or losses. It is very important for business managers to
understand the information found on financial reports because the
information from the financial reports enables business managers
to see how to improve and keep the business afloat. It also gives
business managers an insight what came in and went out and the
total operating cost of the company as well as cutting cost in a
certain areas. The information from the financial reports helps the
manager manages the business accurately.
-----------------------------------------------------------
ACC 291 Week 2 IndividualWileyPLUS PracticeCh 8,9,10

Quiz
Resource:WileyPLUS
Complete the WileyPLUS Week Two Practice Quizzes
for chapters 8, 9, and 10
STOCK DIVIDEND
Stock Split
University of Phoenix
Stock Dividend
In the present time, the stock dividend has become
important concept. When dividend is given in form of
stock, it is called stock dividend. In this form of
dividend, the cash does not use. It is important, when
the corporation declares stock dividend, the market
value of the share decreases because the number of
stock increases. The many companies prefer stock
dividend due to the tax benefit. If the individual gets
stock dividend, he does not pay any tax on stock
dividend. Thus the stock dividend reduces tax burden.
On the other hand, the ownership of investors also
spurs up in the company because the number of
holding share increases. There is also disadvantage of
stock dividend. The market value of the share
decreases, so the market value of holding also
decreases (Kennon, 2009).
The ABC Company is leading company in its industry.
The number of outstanding share of the company is
one million. On the other hand, the number of investors
is five millions. The value of market capitalization is
$100 million. The management declares 20% stock
dividend. Thus the 200000 shares will be distributed as
a stock dividend. The number of outstanding share will
be increased by 200000 and the new total number of
outstanding stock will be 1.2 million. On the other
hand, the new value per share in the market will be
$83.33 (100 million/1.2 million). This example is taken
from below mentioned link:
Stock Split
The stock split is also an important concept. When the
management wants to increases number of shares, the
management follows this method. In this method, the
face value of the share is split and number of share
gets increased. Due to increment in number of
outstanding share, the market value of per share also
gets affected but the total market capitalization of the
company does not affect. Both stock split and stock
dividend increase number of outstanding shares but
both are different due to the accounting treatment. In
the stock split, the investors do not get any real
benefit. It is also known as non-cash distribution of
dividend. The motto behind stock split is to increase
trading of the shares in the market (Baker, 2009)
For example, the face value of per share is $100
and the total outstanding shares are 100 million. If the
management of the company announces stock split in
ratio of 1:2, the total outstanding shares will be
increased by 100 million, thus the new total number of
the share will be 200 million. On the other hand, the
face value of the share will reduce by 50%. So the new
face value of the share will be $50. Due to effect of
stock split, the holding share of the investor will also
increase in the prorate basis. If the investor has 10
shares, now he will have 20 shares. It is important
thing that the total issued capital will not be changed.
The illustration of stock split has been got from
following link:
Reverse Stock Split
The reverse stock split is just opposite of stock split. In
this process, the management reduces the number of
outstanding shares. The company increase face value
of the share. In this method corporation decides a ratio
such as 2:1. Thus the company accumulates two shares
in one share. In this method, the total market value of
company does not change. Due to reverse stock split,
the earning per share and face value of per share rises.
Thus the reverse stock split provides just opposite
result from stock split. It is important question, why
company selects this method. When the management
seems that the face value of the share is less as
compared to competitors then the company goes for
this method to make its share value to equal to
competitors shares face value. It is also a sound
strategy to increase treading of shares. If the face
value of share is too cheap in comparison to
competitors, the investors will be discouraged for
investment. For increasing the confidence of investors,
the management uses this method (Mladjenovic,
2009).
For example, an investor holds 100 shares of XYZ
Company and the face value per share is $50. If the
management go for reverse stock split option and
declares one share for 10 shares then the holding of
the individual will reduce 9 shares for every 10 shares.
Thus the new holding of the investor will be 10
(100/10) shares but the face value per share will be
$500. It is also important that the total market
capitalization will remain as same as before reverse
split. The example of the reverse split is take form
below mentioned link:
http://www.sec.gov/answers/reversesplit.htm.
References
Baker, H. K. (2009). Dividends and Dividend Policy. John
Wiley and Sons.
Kennon, J. (2009). All About Dividends. Retrieved May
31, 2010, from
http://beginnersinvest.about.com/od/dividendsdrips1/a/aa040904_2.h
tm
Mladjenovic, P. (2009). Stock Investing for Dummies.
Dummies.
-----------------------------------------------------------
ACC 291 Week 2 Learning Team Weekly Reflection
Discuss the objectives for Weeks One and Two. Your
discussion should include the topics you feel
comfortable with, any topics you struggled with, and
how the weekly topics relate to application in your
field.
Analyzing an Income Statement

The net income of Kodak has decreased a bit; it
appears that the company is more profitable. By
conducting a side by side analysis from 2004 to
2003 the company has increased in current
assets and decreased in total assets. It appears
that the company went down in property, plant
and equipment net as well as discontinued
operations. So, despite the decrease in total
assets it looks like the company has made a good
decision.
The company has also decreased its total

liabilities by about 4%. I believe this to be good
because the short term borrowings and long
term debt has decreased. To me, this means that
the company is tightening their belt and paying
off old debt.
Total shareholders equity has down a little bit in

dollars, but on the percentage level the
companys percentage has gone up. I believe this
is because the company issued $104k more
shares in 2004 than in 2003. The company has
the same amount of shares outstanding in 2004
that it did in 2003 as well. Retained earnings on
the stock have gone up in 2004 as well. I believe
this is contributed by the more shares that have
been issued.
I believe the profitability of the company is
under good standings. They appear to be making
the necessary adjustments in the company to
stay with in a profitable income.
-----------------------------------------------------------
ACC 291 Week 2 Wileyplus Assignment P8-3A, BE9-11,

DI9-5, E9-7, E9-8, BYP9, P9-2A (New)
P8-3A, BE9-11, DI9-5, E9-7, E9-8, BYP9, P9-2A.
Problem 8-3A: Bosworth Company
Brief Exercise 9-11: Nike, Inc.

Cash Flow Statement Analysis
The cash flow statement is important financial statement of the
corporation. The cash flow statement states from where cash has come
and where cash has been gone. Thus the cash flow statement makes a
relationship between beginning balance and ending balance of cash. The
cash flow statement is prepaid on the basis of income statement and
balance sheet of the company. The Little Bit Incs beginning cash balance
including marketable securities was $24000. On the other hand, the
ending cash balance including marketable securities of the company was

$40000 (Weygandt, Kimmel & Kieso, 2009).
The net income of the company was $5500 during 2009. The company
generated cash inflow from operating activity is less as compared cash out
flow from operating activities. The company generated $9000 negative
cash balance in operating activity section of the cash flow statement. On
the other hand, in the investment section, the firm has also negative cash
balance. The firm has $7000 negative balance in investment section of the
cash flow statement. The Little Bit Inc made investment during the year
instead of selling of assets. Last section of the cash flow statement is
financing activity section. In which, all finance related activities come. The
corporation sold some shares and borrowed some money from outside
lenders therefore the company has positive case balance by $32000 in
financing activity section.
Reference
Weygandt, J.J.,Kimmel, P.D. & Kieso, D.E. (2009). Managerial Accounting:
Tools for Business Decision Making. John Wiley and Sons.
-----------------------------------------------------------
ACC 291 Week 3 Assignment The Liabilities Section of
OBrians Balance Sheet
is to help you understand the balance sheet
presentation for the liabilities of a company.
Assignment Steps Resources: Financial Accounting:
Tools for Business Decision Making Prepare the
liabilities section of OBrians balance sheet using the
following information: Accounts payable $157,000
Week 5 DQ 1
Due Tuesday, Day 2
In what ways does the statement of cash flows relate to

the balance sheet and income statement?
It is important to understand what we are doing with

the numbers and the results these numbers give us
because the result is the information that will be
available to us from financial statements. Although
some want to see the income statement and ignore the
other statements we need to use them together to see
the total picture of what is happening to our business.
The relationship between the numbers on the financial
statements shows us everything we need to know
about the business.
The income statement shows income and expenses for
a period of time and if we are making or loosing money.
The balance sheet compares the assets to liabilities
and shows how much money the business would have
if everything is sold today.
The statement of cash flow might be the most critical
statement because there is plenty of information we
can gain form it. This statement relates with the
income statement on operating activities to see if they
are generating cash or not. It is related to the balance
sheet on how much cash is used in investing activities.
In relationship with the balance sheet the cash flow
statement shows what cash is provided or used by
financing activities. It will tell us how much debt has
been paid and will indicated if we are using more debt
or have paid down the credit line.
When the business makes a sale or receives payment
for a sale on credit that is an inflow. A sale shows up as
income on the profit and loss statement and as an
inflow on the cash flow statement. It also shows up
either as cash or accounts receivable on the balance
sheet. Also, how quickly we can collect on accounts
receivable will play a big role in the cash flow. When
the business spends money, it shows up as an expense
in the profit and loss statement and as an outflow on
the cash flow statement. It also shows up on the
balance sheet as a decrease in cash, or an increase or
decrease in liabilities, depending on what the expense
represents.
Response 2
In what ways does the statement of cash flows
relate to the balance sheet and income statement?
The cash flow statement relates to the income
statement and balance sheet. The net income from the
income statement is listed on the statement of cash
flows. Operating activities are analyzed on the
statement of cash flows; this section of the statement
reconciles the net income to the actual cash the
company received from or used during operations. The
second section of the statement of cash Flows is the
cash flow from investing activities which include
purchase or sale of assets. The last section in the
Statement of Cash Flows is the cash flows from
financing activities that includes raising cash by selling
stocks/bonds or borrowing from backs; or cash out
flows from paying back loans. The balance sheet shows
the different account balances at the end of the
accounting period. The statement of cash flows reflects
changes in the accounts listed on the balance sheet
between accounting periods. The net cash from
operating, financing, and investing activities are added
up to calculate the net change in cash.
Week 5 DQ 2
Due Thursday, Day 4
Discuss how the statement of cash flows is utilized by
investors. If you were an investor reviewing a
statement of cash flows, what section might interest
you most? Why? Discuss the circumstances in which
other sections of the statement might be important to
an investor.
Prior to making an investment in a company, one would

want to understand the decisions the owners are
making to fund the operations of the company daily.
Maintaining sufficient cash to acquire new product, pay
overhead, and satisfy generated sales would be the
predominant need of the company. Second need would
be for the company to have sufficient cash to remain
competitive. This may require cash to invest in
research and development, increase inventory as new
product introduction, improve efficiency in plant and
equipment, or cash to satisfy prior borrowing
obligations. By reviewing the statement of cash flow,
the investor can determine if the company is
generating sufficient cash internally to fund operations
or are they requiring outside injection of cash to
finance the short fall in cash needed to operate the
company. Last, the investor can review the statement
of cash flow to better understand the leverage of the
company and the requirement for repayment of debt,
or dividends to reward prior investments.
Response 2
Discuss how the statement of cash flows is utilized by
investors. If you were an investor reviewing a
statement of cash flows, what section might interest
you most? Why? Discuss the circumstances in which
other sections of the statement might be important to
an investor.
The statement of cash flow is utilized by investors

because it has all information integrated from the
balance sheet and the income statement. The
statement of cash flow is used by an investor to see if
the operating activities are greater than the net income
to have earnings that are called high quality. If
operating activities are less, then a red flag will be
raised as to why the net income is not becoming
cash. Another reason would be investors believe cash is
the best. The statement shows all cash coming and
going from the business. If the company generates
additional cash than what is being used, then the
company can reduce their debt, acquire another
business, or buy some of the stock back. The last
reason why would be that financial models are based
upon the statement of cash flow.
If I was an investor reviewing a statement of cash flows
the section that might interest me the most would be
the operating activities. I would like to know how the
company was doing and what areas need to be
improved to have more cash generated in the
business. All the sections are important to an investor
so they can see the complete big picture of their
investment.
-----------------------------------------------------------
Why does a company choose to form as a corporation?
Candela Corporation
Candela Corporation
Candela Corporation and Subsidiaries have been working for

over 34 years developing and commercialize aesthetic laser systems
that allow physicians and personal care providers to treat a variety of
cosmetic and medical conditions such as removal of spider veins,
scars, stretch marks, warts, as well as hair removal and age spots,
freckles and tattoos. Other skin treatments such as psoriasis and acne
and acne scars are also treated. (Axia College, 2007)
Going from top to bottom on The Candela Corporation and
Subsidiaries Consolidated Statement of Cash Flows; for the operating
activities, 2002 shows an alarming loss in the net income while 2003
and 2004 for the company are showing a significant and steady climb
in the net income. In 2004 there was a new category added called
Provision for the disposal of discontinued operations and the
category has caused an increased the account for 2004. Loss from
discontinued operations grew from 2002 to 2003 but had a significant
decline for 2004. Depreciation has increased over the last 3 years as
well. Provision for bad debts increased significantly too, but an
increase in bad dept is expected as revenue increases. The provision
for deferred taxes shows the company went from a loss in 2002 and
2003 to show there was no tax loss in 2004. The tax benefit from
exercised stock options has practically doubled sense 2003. The
changes in assets and liabilities for the last 3 years have been up and
down. Receivables have increased, notes receivable decreased, and
inventories have increased. Other current assets, other assets have
also increased. Accounts payable has made a significant decrease in
the last 3 years as well as accrued payroll expenses. The accrued
payroll decreasing could mean that the amount of employees over the
years has decreased as well. The accrued warranty costs have
increased as well; this could mean that the company renewed
equipment warranties. The net cash provided by operating activities
looks to have gone from a loss in 2002 to a large profit in 2003 and
then a decrease, yet still a profit for 2004. It appears on the
operations level that management needs to do more to regulate the
companys finances so there is not an up and down variance each
year.
The cash flow from investing activities shows me that in the last
three years they had large amount of investments in 2002 and 2003
but now they are letting them decrease.
The cash flow from financing activities states that the proceeds
from issuance of common stock have increased significantly from
2002 to 2003 and rose a little more in 2004. The repurchases of stock
has not happened sense 2002 and the principle payment of long-term
debt grew in 2003 from 2002 and shows no activity for 2004. Same
goes for the net borrowing on line of credit; it appears that Candela
Corporation is current on payments to line of credit. So, the net cash
from financial activities looks great for 2004. The cash and cash
equivalents for each year have increased steadily.
After reviewing the consolidated statement of cash flows for

Candela Corporation, I believe the company is making a profit, but
perhaps need some control over their operating activities.
Reference
Axia College. (2007). Statement of Cash Flows. Retrieved June 14,

2010 from Axia
College, Week Six, ACC 230.
-----------------------------------------------------------
Why is preferred stock referred to as preferred?
Analyzing an Income Statement
The net income of Kodak has decreased a bit; it appears that the
company is more profitable. By conducting a side by side analysis
from 2004 to 2003 the company has increased in current assets and
decreased in total assets. It appears that the company went down in
property, plant and equipment net as well as discontinued operations.
So, despite the decrease in total assets it looks like the company has
made a good decision.
The company has also decreased its total liabilities by about 4%. I
believe this to be good because the short term borrowings and long
term debt has decreased. To me, this means that the company is
tightening their belt and paying off old debt.
Total shareholders equity has down a little bit in dollars, but on the
percentage level the companys percentage has gone up. I believe this
is because the company issued $104k more shares in 2004 than in
2003. The company has the same amount of shares outstanding in
2004 that it did in 2003 as well. Retained earnings on the stock have
gone up in 2004 as well. I believe this is contributed by the more
shares that have been issued.
I believe the profitability of the company is under good standings.

They appear to be making the necessary adjustments in the company
to stay with in a profitable income.
-----------------------------------------------------------
ACC 291 Week 3 Individual WileyPLUS Assignment
The cash flow statement is important financial statement of the

corporation. The cash flow statement states from where cash has
come and where cash has been gone. Thus the cash flow statement
makes a relationship between beginning balance and ending balance
of cash. The cash flow statement is prepaid on the basis of income
statement and balance sheet of the company. The Little Bit Incs
beginning cash balance including marketable securities was $24000.
On the other hand, the ending cash balance including marketable
securities of the company was $40000 (Weygandt, Kimmel & Kieso,
2009).
The net income of the company was $5500 during 2009. The company
generated cash inflow from operating activity is less as compared
cash out flow from operating activities. The company generated
$9000 negative cash balance in operating activity section of the cash
flow statement. On the other hand, in the investment section, the firm
has also negative cash balance. The firm has $7000 negative balance
in investment section of the cash flow statement. The Little Bit Inc
made investment during the year instead of selling of assets. Last
section of the cash flow statement is financing activity section. In
which, all finance related activities come. The corporation sold some
shares and borrowed some money from outside lenders therefore the
company has positive case balance by $32000 in financing activity
section.
Reference
Weygandt, J.J.,Kimmel, P.D. & Kieso, D.E. (2009). Managerial

Accounting: Tools for Business Decision Making. John Wiley and
Sons.
-----------------------------------------------------------
ACC 291 Week 3 Individual WileyPLUS Practice Quiz Ch.

11,12
Resource:WileyPLUS
Week 5 DQ 1
Due Tuesday, Day 2
In what ways does the statement of cash flows

relate to the balance sheet and income
statement?
It is important to understand what we are doing

with the numbers and the results these numbers
give us because the result is the information that
will be available to us from financial statements.
Although some want to see the income
statement and ignore the other statements we
need to use them together to see the total
picture of what is happening to our business. The
relationship between the numbers on the
financial statements shows us everything we
need to know about the business.
The income statement shows income and
expenses for a period of time and if we are
making or loosing money. The balance sheet
compares the assets to liabilities and shows how
much money the business would have if
everything is sold today.
The statement of cash flow might be the most
critical statement because there is plenty of
information we can gain form it. This statement
relates with the income statement on operating
activities to see if they are generating cash or
not. It is related to the balance sheet on how
much cash is used in investing activities. In
relationship with the balance sheet the cash flow
statement shows what cash is provided or used
by financing activities. It will tell us how much
debt has been paid and will indicated if we are
using more debt or have paid down the credit
line.
When the business makes a sale or receives
payment for a sale on credit that is an inflow. A
sale shows up as income on the profit and loss
statement and as an inflow on the cash flow
statement. It also shows up either as cash or
accounts receivable on the balance sheet. Also,
how quickly we can collect on accounts
receivable will play a big role in the cash flow.
When the business spends money, it shows up as
an expense in the profit and loss statement and
as an outflow on the cash flow statement. It also
shows up on the balance sheet as a decrease in
cash, or an increase or decrease in liabilities,
depending on what the expense represents.
Response 2
In what ways does the statement of cash
flows relate to the balance sheet and income
statement?
The cash flow statement relates to the income
statement and balance sheet. The net income
from the income statement is listed on the
statement of cash flows. Operating activities are
analyzed on the statement of cash flows; this
section of the statement reconciles the net
income to the actual cash the company received
from or used during operations. The second
section of the statement of cash Flows is the
cash flow from investing activities which include
purchase or sale of assets. The last section in the
Statement of Cash Flows is the cash flows from
financing activities that includes raising cash by
selling stocks/bonds or borrowing from backs; or
cash out flows from paying back loans. The
balance sheet shows the different account
balances at the end of the accounting period.
The statement of cash flows reflects changes in
the accounts listed on the balance sheet
between accounting periods. The net cash from
operating, financing, and investing activities are
added up to calculate the net change in cash.
Week 5 DQ 2
Due Thursday, Day 4
Discuss how the statement of cash flows is

utilized by investors. If you were an investor
reviewing a statement of cash flows, what
section might interest you most? Why? Discuss
the circumstances in which other sections of the
statement might be important to an investor.
Prior to making an investment in a company, one

would want to understand the decisions the
owners are making to fund the operations of the
company daily. Maintaining sufficient cash to
acquire new product, pay overhead, and satisfy
generated sales would be the predominant need
of the company. Second need would be for the
company to have sufficient cash to remain
competitive. This may require cash to invest in
research and development, increase inventory as
new product introduction, improve efficiency in
plant and equipment, or cash to satisfy prior
borrowing obligations. By reviewing the
statement of cash flow, the investor can
determine if the company is generating sufficient
cash internally to fund operations or are they
requiring outside injection of cash to finance the
short fall in cash needed to operate the
company. Last, the investor can review the
statement of cash flow to better understand the
leverage of the company and the requirement for
repayment of debt, or dividends to reward prior
investments.
Response 2
Discuss how the statement of cash flows is
utilized by investors. If you were an investor
reviewing a statement of cash flows, what
section might interest you most? Why? Discuss
the circumstances in which other sections of the
statement might be important to an investor.
The statement of cash flow is utilized by

investors because it has all information
integrated from the balance sheet and the
income statement. The statement of cash flow is
used by an investor to see if the operating
activities are greater than the net income to
have earnings that are called high quality. If
operating activities are less, then a red flag will
be raised as to why the net income is not
becoming cash. Another reason would be
investors believe cash is the best. The
statement shows all cash coming and going from
the business. If the company generates
additional cash than what is being used, then the
company can reduce their debt, acquire another
business, or buy some of the stock back. The last
reason why would be that financial models are
based upon the statement of cash flow.
If I was an investor reviewing a statement of
cash flows the section that might interest me the
most would be the operating activities. I would
like to know how the company was doing and
what areas need to be improved to have more
cash generated in the business. All the sections
are important to an investor so they can see the
complete big picture of their investment.
-----------------------------------------------------------
Discuss the objectives for Week Three. Your discussion
should include the topics you feel comfortable with,
any topics you struggled with, and how the weekly
topics relate to application in your field.
Candela Corporation
Candela Corporation
Candela Corporation and Subsidiaries have
been working for over 34 years developing and
commercialize aesthetic laser systems that allow
physicians and personal care providers to treat a
variety of cosmetic and medical conditions such
as removal of spider veins, scars, stretch marks,
warts, as well as hair removal and age spots,
freckles and tattoos. Other skin treatments such
as psoriasis and acne and acne scars are also
treated. (Axia College, 2007)
Going from top to bottom on The Candela
Corporation and Subsidiaries Consolidated
Statement of Cash Flows; for the operating
activities, 2002 shows an alarming loss in the net
income while 2003 and 2004 for the company are
showing a significant and steady climb in the net
income. In 2004 there was a new category added
called Provision for the disposal of discontinued
operations and the category has caused an
increased the account for 2004. Loss from
discontinued operations grew from 2002 to 2003
but had a significant decline for 2004.
Depreciation has increased over the last 3 years
as well. Provision for bad debts increased
significantly too, but an increase in bad dept is
expected as revenue increases. The provision for
deferred taxes shows the company went from a
loss in 2002 and 2003 to show there was no tax
loss in 2004. The tax benefit from exercised
stock options has practically doubled sense
2003. The changes in assets and liabilities for
the last 3 years have been up and down.
Receivables have increased, notes receivable
decreased, and inventories have increased.
Other current assets, other assets have also
increased. Accounts payable has made a
significant decrease in the last 3 years as well as
accrued payroll expenses. The accrued payroll
decreasing could mean that the amount of
employees over the years has decreased as well.
The accrued warranty costs have increased as
well; this could mean that the company renewed
equipment warranties. The net cash provided by
operating activities looks to have gone from a
loss in 2002 to a large profit in 2003 and then a
decrease, yet still a profit for 2004. It appears on
the operations level that management needs to
do more to regulate the companys finances so
there is not an up and down variance each year.
The cash flow from investing activities shows
me that in the last three years they had large
amount of investments in 2002 and 2003 but
now they are letting them decrease.
The cash flow from financing activities states
that the proceeds from issuance of common
stock have increased significantly from 2002 to
2003 and rose a little more in 2004. The
repurchases of stock has not happened sense
2002 and the principle payment of long-term
debt grew in 2003 from 2002 and shows no
activity for 2004. Same goes for the net
borrowing on line of credit; it appears that
Candela Corporation is current on payments to
line of credit. So, the net cash from financial
activities looks great for 2004. The cash and cash
equivalents for each year have increased
steadily.
After reviewing the consolidated statement of
cash flows for Candela Corporation, I believe the
company is making a profit, but perhaps need
some control over their operating activities.
Reference
Axia College. (2007). Statement of Cash Flows.

Retrieved June 14, 2010 from Axia
College, Week Six, ACC 230.
-----------------------------------------------------------
ACC 291 Week 3 Wileyplus Assignment P9-7A, E10-5, E10-

8, E10-13, E10-22, E10-24, BYP10, P10-9A, P10-13A,
IFRS10-4 (New)
P9-7A, E10-5, E10-8, E10-13, E10-22, E10-24,
BYP10, P10-9A, P10-13A, IFRS10-4.
Exercise 10-5: Olinger Company
Exercise 10-8: Ortega Company
Exercise 10-13: Romine Company
Exercise 10-22: Cole Corporation

Analyzing Statements of Cash Flows

4.8. Research Problem
Choose five companies from different industries and locate their
statements of cash flows
for the most recent year.
(a) Create a table to compare the dollars provided or used by operating,
investing, and financing activities, as well as the overall increase or
decrease in cash.
(b) Create a second table for each company comparing this same
information for each of the three years presented in that companys
statement of cash flows. Include an additional column that looks at the
combined cash flows for all three years.
(c) Write a short analysis of the information gathered. Your discussion
should address, among other things, whether cash flow from operating
activities is large enough to cover investing and financing activities, and if
not, how the company is financing its activities. Discuss differences and
similarities between the companies you have chosen .

(a) Create a table to compare the dollars provided or used by operating,
investing, and financing activities, as well as the overall increase or
decrease in cash.

STATEMENT OF CASH FLOW ANALYSIS
STARBUC HARELY
KS DAVIDSON RITE AID
2008 2008 2008
NET INCOME / STARTING $ $ $

LINE 315.5 - (1,079.0)
$ $ $
OPERATING ACTIVITIES 1,258.7 (684.7) 79.4
$ $ $
INVESTING ACTIVITES (1,086.6) (393.3) (2,933.7)
$ $ $
FINANCING ACTIVITIES (184.5) 1,293.4 2,904.0
$ $ $
CASH (11.5) 190.7 49.9

(b) Create a second table for each company comparing this same
information for each of the three years presented in that companys
statement of cash flows. Include an additional column that looks at the
combined cash flows for all three years.
STARBUCKS
2008 2007 2006
Net Income/Starting Line 315.5 672.64 564.26
Cash from Operating Activities 1258.70 1331.22 1131.63
Cash from Investing Activities -1086.60 -1201.95 -841.04
Cash from Financing Activities -184.50 -171.89 -155.33
Net Change in Cash -11.50 -31.35 138.80
Net Cash - Beginning Balance 281.30 312.61 173.81
Net Cash - Ending Balance 269.80 281.26 312.61

HARLEY DAVIDSON
2008 2007 2006
Net Income/Starting Line 0 933.84 1043.15
Cash from Operating -684.65 798.15 761.78

Activities
Cash from Investing

Activities -393.25 391.21 -35.26
Cash from Financing

Activities 1293.39 -1037.80 -637.02
Net Change in Cash 190.70 164.46 97.42
Net Cash - Beginning

Balance 402.85 238.40 140.98
RITE AID
2008 2007 2006
Net Income/Starting Line -1078.99 26.83 1273.01
Cash from Operating Activities 79.37 309.15 417.17
Cash from Investing Activities -2933.74 -312.78 -231.08
Cash from Financing Activities 2903.99 33.72 -272.84
Net Change in Cash 49.61 30.08 -86.75
Net Cash - Beginning Balance 106.15 76.07 162.82
-----------------------------------------------------------

Why are companies required to prepare a statement of cash flows?
Why is the statement of cash flows divided into three sections?
Findwhat.com Case - CheckPoint
ACC 230
Findwhat.com has recorded the 135 percent increase in the revenue

which is mainly due to the business acquired of Espotting during the
year. The different accounting policies are present for the acquiring
firm and the acquired firm. The company has recorded certain
premature revenues for the amount which advertisers had made only
the advance deposit. As result, the company is recognizing the vendor
financing as revenue. In some places, the gross revenue has been
recognized while in another, the net revenue has been recognized. The
network click revenue is recognized at gross level while the private
level revenue is taken at net level. Some of the revenue expenditures
have been recognized as the capital expenditures.
Revenue for set up network fee is treated as deferred revenue and is

recognized over a period of time. The company is very inconsistent
with regards to its accounting policies in terms of recognition of
revenue. The provision and treatment of amount for doubtful debt is
also not satisfactory. When a customer clicks on a sponsored
advertisement, the whole of the revenue due to him is recognized. The
company is having a very high amount of doubtful debt balance at the
end of the year ending December 31, 2004.
-----------------------------------------------------------
What are some common ratios used to analyze financial information?
Which are the most important?
Week 7 DQ 1
Due Tuesday, Day 2
Post your answer to Study Question 5.2 on p. 180 (Ch. 5). As you
read your classmates responses, consider the following scenario: If
you compared two different companies that utilized two different
valuation methods, how might the quality of the results differ? Also,
comment on the difficulty of making comparisons between two firms
that use different valuation methods.
Understanding the different inventory methods is crucial. First

the person that establishes the inventory needs to determine which
method to use. LIFO, or FIFO. LIFO means Last in First Out. This
means that when a purchase is made, and sales are recorded the
newest product is used first. So if I bought 10 combs at $2 on
December 1st, and then I buy 5 combs at $2.50 on December
10th. When sales are made I am going to record sales using the $2.50
until I sell through the 5 combs that were purchased on the 10th, and
then the cost will go to the previous purchase price of $2 until those
10 combs are sold through. FIFO is just the opposite. Meaning that
goods are used in the order that they are received. The first items
ordered, are the first items sold. Either method will pass an audit. It
is important to note though that managers can't switch back and forth
between the two methods. Profit will vary depending on which
method is being used. Say you sold only 6 combs at $3 each. Using
the LIFO method this would equal $3.50 profit. If you used the FIFO
method, this would result in a $6.00 profit.
Response 2
Post your answer to Study Question 5.2 on p. 180 (Ch. 5). As you
read your classmates responses, consider the following scenario: If
you compared two different companies that utilized two different
valuation methods, how might the quality of the results differ? Also,
comment on the difficulty of making comparisons between two firms
that use different valuation methods.
It is very important to understand which inventory valuation method
is being used to determine the profit numbers quality. The balance
sheet, statement of cash flow and income statement can be directly
impacted by the valuation method that used to determine the costs of
inventory. The three methods that are used are FIFO, LIFO and
Average Cost. The valuation ratios can be dramatically affected
depending on the inventory valuation that is being used over a long-
term period; especially because prices are likely to rise. When using
FIFO you can increase net income, but then at the same time raise
the amount taxes that business is obligated to pay. When using LIFO
the inventory can be obsolete because they are old this will result in
lower net revenue because the products pricing is higher. The Average
Cost results usually fall between LIFO and FIFO. The bottom line
can be affected mainly by the inventory analysis and the ratio results
that are formed from that analysis. It is easier to compare companies
that are in the same line of business, so I believe that quality of results
would differ tremendously if different valuation methods were used.
If you use LIFO that company may seem unattractive but they are
performing well, as for FIFO it may look good as for profit, but may
not be performing well.
DQ 2
Week 7 DQ 2
Due Thursday, Day 4
Post your answer to Study Question 5.6 on p. 180 (Ch. 5). Discuss
the consequences of poor quality reporting. What has the U.S.
government done to improve the quality of reporting after recent
financial scandals such as Enron?
I think that the significance is that the analysts only see this one
HUGE transaction. The events that actually led up to this large
transaction actually took place over a 2 year period. These items
should have been written off as they occurred. Wall Street would not
have known that the executives refused to write off these accounts
when they should have. Wall Street only see's the one large
transaction. If the company would have been more honest in their
reporting they would have seen (more than likely) that there were
many accounts over a two year period that should have been written
off at different periods. So the analysts would not have seen a pattern
of recurring write-offs. If the analysts only see the one transaction
they are less likely to be able to paint an accurate picture of the
financial standing of the business for investors, or potential
investors. If the investors could see that there were many accounts
that had to be written off maybe their investing decisions would have
been different. The regulation of the accounting field has grown by
leaps and bounds since the Enron scandal. The government has
implemented several agencies and regulations to ensure honesty in
accounting practices. SOX is one example of an agency that has been
put into place to ensure honesty in accounting. SOX implements
things like internal controls, and accountability for CEO's and
CFO's.
Response 2
I believe the impact and importance of this write-off event is a very
big matter. It is obvious how they handled it that it was a scandal
from the start. I think that everyone involved had a big role in how
things played out. To me I think of the investors as a really big hit to
this but also feel that audit committees have to be held responsible as
well. It has been shown over many examples that adit oversights are
happening to financial reporting. Although I do feel they are getting
better and tighter due to conforming tightly with the GAAP requests.
I feel over time the accounts receivable should have been written off
in smaller increments and not all taken by $405 million at once.
Maybe that isn't correct but it would have been easier I would think to
take the receivables over time.
Response 3
Wall Street should have read the footnotes and seen that the write off
was for accounts receivables and should have been reported in the
allowance for doubtful accounts. Every company that allow sales on
credit face doubtful accounts; therefore, the write off may reoccur.
The significance of this transaction is that WorldCom want to cover
up the $405 million dollars that it was unable to collect from its
customers, but WorldCom wrote off a large sum of money rather
recording the write-off as needed and the analyst over looked it.
Depending on how the company policy is for writing off accounts,
from 1998 to the 3rd quarter in 2000 is 11 quarters. If the company
wrote off bad accounts quarterly it should have wrote off
36,818,181.82 per quarter. Investors would not want to continue to
invest into a company that has poor collection skills, or poor
management. Unusual items are simply for those items that are not
recurring operating expenses. Bad debts do not fall under this
category. Since the Enron and WorldCom scandals many rules and
regulations have been put in place by the government such as SOX.
More people are being held accountable for their actions and
consequences follow poor quality reporting such as fudging the
books.
-----------------------------------------------------------
ACC 291 Week 4 Individual WileyPLUS Assignment
Presenting to Stakeholders
Presenting to Stakeholders
Financial statements provide insight into the companys current

status and lead to the development of policies and strategies for the
future (Axia, 2007). Financial statements and notes to the financial
statements should be used to analyze the company. For instance, what
do the financial statements reveal about why the company has
requested a loan or purchased items on credit? What is the firms
capital structure and what does the firm have outstanding? How well
can the company pay back debt? What recourses are used to pay
debt? What is the companys performance record and are there any
future expansions? What are the expected returns and how successful
is the company compared to industry averages? Which areas of
operations contributed to the companys success, and what are the
strengths and weaknesses of the company? What changes can be
made to improve the future performance of the company?
Key financial ratios will assist in determining the information

requested. Liquid ratios measure a firms ability to meet cash needs
as they arise. The current ratio is a good tool to use because it
measures the ability the firm has to pay debts when due. The current
ratio for REC is at 2.4 times for 2007, although it is down from 2006
the company is still able to pay current debt when due. Cash flow
ratio considers cash flow from operating activities has increased from
2006, and this indicates an improvement in short-run solvency.
Average collection period has gone down 5 days within the last year.
The cash conversion cycle gives in-site on why the cash flow has
improved or decreased, in this case the conversion period for REC
has improved by 26 days.
Activity ratios measure the liquidity of specific assets and the

efficiency of managing assets. Accounts payable turnover is up seven
times from the prior year and inventory turnover is also up .25 from
last year. Accounts payable turnover is down 9.05 from 12.10 in 2006.
This means that the company is taking longer to repay payables. The
fixed asset turnover and total asset turnover ratios are used to assess
managements skills in generating sales from investments in assets.
The fixed asset turnover has dropped slightly, but the total asset
turnover has risen slightly. The increase in total asset turnover comes
from improvements in inventory and accounts receivable turnover.
Leverage ratios measure the extent of a firms financings with debt

relative to equity and its ability to cover interest and other fixed
charges (Axia, 2007). Debt ratio, long-term debt to total
capitalization and dept to equity have all raised slightly implying a
slightly riskier capital structure. The times interest earned and the
cash interest coverage have increased since 2006. The interest
payments can be covered 7.4 times this year. The cash interest has
improved due to the operating profits and cash from operations. The
fixed coverage ratio is also important in cases where companies use
operating leases. In this case, the fixed charges have increased
slightly.
Profitability ratios are used to measure the overall performance of a

firm and its efficiency in managing assets, liabilities, and equity. The
ratios used are the gross profit margin, operating profit margin and
net profit margin. All of which have improved for REC. As well as the
cash flow margin, return on total assets, return on equity and cash
return on assets. Over all the company seems to be in well financial
standings and looking toward a profitable year.
Reference
Axia College. (2007). The Analysis of Financial Statements. Retrieved

June 28, 2010,
from Axia College, Week Eight, ACC 230.
-----------------------------------------------------------
ACC 291 Week 4 IndividualWileyPLUS Practice
Resource:WileyPLUS
Analysis of Scenarios:
Debt Scenario would increase the debt ratios
from to 50%. Equity Scenario would reduce the
debt ratio to 40%. With Debt option, earnings
per share would be higher. Interest declines to
2.86 times with the Debt option while times
interest earned increases to 3.75 times with the
Equity option. Either option exhibits a good use
of financial leverage because for both, the
financial leverage index being greater than 1.
However, it is higher using the Debt option.
-----------------------------------------------------------
Discuss the objectives for Week Four. Your discussion
Interpreting Financial Ratios
Luna Lighting, a retail firm, has experienced

modest sales growth over the past three years
but has had difficulty translating the expansion
of sales into improved profitability. Using
three years financial statements, you have
developed the following ratio calculations and
industry comparisons. Based on this information,
suggest possible reasons for Lunas profitability
problems.
Industry
2009 2008 2007 2009

Current 2.3X 2.3X 2.2X
2.1X
Average collection period 45 days 46 days
47 days 50 days
Inventory turnover 8.3X 8.2X
8.1X 8.3X
Fixed asset turnover 2.7X 3.0X
3.3X 3.5X
Total asset turnover 1.1X 1.2X
1.3X 1.5X
Debt ratio 50% 50% 50%
54%
Times interest earned 8.1X 8.2X
8.1X 7.2X
Fixed charge coverage 4.0X 4.5X
5.5X 5.1X
Gross profit margin 43% 43%
43% 40%
Operating profit margin 6.3% 7.2%
8.0% 7.5%
Net profit margin 3.5% 4.0%
4.3% 4.2%
Return on assets 3.7% 5.0%
5.7% 6.4%
Return on equity 7.4% 9.9%
11.4% 11.8%
Based on this information, some possible

reasons for Lunas profitability problems are
suggested as under:
a) Net Profit margin of the company has
degraded and this might be due to decrease
in the net income of the company due to
increase in expenses. This needs to be
improved upon by cost control and cost
reduction.
b) Return on equity of the company has
degraded further and this also indicates that
there is a decrease in the net income of the
company due to increase in expenses. This
needs to be improved upon by cost control
and cost reduction.
c)Fixed charge coverage has fallen, which
means that the debt payment along with
interest might have increased and this will
also lead to decrease in the net income of
the company and thus degrading the
profitability position of the company.
d) Operating profit margin has dropped
even though gross profit margin has
remained constant. It means that the
operating expenses are higher and need to e
controlled to improve the profitability of the
company.
e) The fixed assets turnover and the return
on assets have also degraded; this also
indicates decrease in the net income of the
company.
f) -----------------------------------------------------------
ACC 291 WEEK 4 Stockholders Equity Section of the
Balance Sheet (Lachlin Corporation Balance Sheet)
is to help you become familiar with examining the
stockholders' equity section of the balance sheet.
Assignment Steps Resources: Financial Accounting
Capstone Discussion Question
Due Tuesday, Day 2
What have you learned in this course about the

process of analyzing financial statements?
I have learned that there is a lot more to analyzing

financial statements than I thought. This class has
made me question my decision to go into the
accounting field. I feel inadequate after taking this
class. I am not an articulate, or analytical person. I
tend to get confused easily and do better at putting the
information together than I am at figuring out what it
all means. This is my last block of classes before my
Bachelor program starts, and I don't know if I am ready,
or if I even want to continue. Analyzing financial
statements takes a very detail oriented mind, and one
that is great at problem solving. It is critical to
understand the financial statements, and how they
relate to one another. There is a lot of information that
is not as obvious as it would seem. Looking at the
bottom line will not give a good picture of how a
company is doing financially. It is important to know
the how and why the bottom line looks the way that it
does.
Response 2
I have learned that it takes someone that has the
patience, tenacity, and motivation to truly analyze the
statements. If you go about it not wanting to do the
work you wont give a good analysis. I found that you
have to be willing to dig deeper than most would to get
a full picture of the company. I found that it is not an
easy task to complete. For me the process is a tedious
one. I don't think I would want to go into that type of
accounting where I have to analyze the statements of a
company. I think for me I would be better in specialized
accounting like A/P or A/R. I am better at figuring out
problems and figuring out ways to make them better. I
am better at specific tasks so for me I wouldn't want to
analyze the statements. I am glad to have learned how,
because at some point I am sure it will come in handy.
Response 3
All financial statements are essential documents
because they tell what has happened to a business
over a period of time but most users of financial
statement are more concerned about what will happen
in the future. Stockholders and creditors are
concerned with future earnings and dividends and
company's future ability to repay its debts.
Management is concerned with the company's ability
to finance future expansion.
Working as a bookkeeper I do all the steps in monthly
cycles consisting of entering transactions into the
journals, working with A/R, A/P, payroll and preparing
the reports, but I have not been able to analyze the
reports the way I learned in this class. I learned how
important is to monitor and interpret the results. I
learned how to compare financial statements of a
company with a company from the same industry and
point out the differences and similarities. This class
taught me the importance of analyzing the Income
Statement, Balance Sheet, Cash Flow Statement and
Stockholders Equity each one individually. I learned
how essential is the quality reporting and how useful
this quality is in business decision making. I learned
about key financial ratios: liquidity ratios, activity
ratios, leverage ratios, and profitability ratios. All these
ratios are valuable as analytical tools and will help me
indicate the areas of strength and weakness in a
business. Even though I learned the information step
by step in this class I tent to go over every single
chapter all over again to better absorb the material.
This class taught us the potential of some management
manipulations of financial statements, thus following
the general accounting rules, being honest, ethical and
professional are the ways on leading to safe and
profitable decisions.
-----------------------------------------------------------
ACC 291 Week 4 Wileyplus Assignment Do It! 11-1, E11-5,

E11-7, BYP11-1, BYP11-2, P11-5A, P11-8A (New)
Do It! 11-1, E11-5, E11-7, BYP11-1, BYP11-2,
P11-5A, P11-8A.
Do It! 11-1
Exercise 11-5 Garcia Corporation

Evaluating Financial Health 1

Evaluating Financial Health
Apple Inc. (AAPL)


Apple Inc. (AAPL)
Apple is one of the strong market participants of computer industry. It also
involve in manufacturing of telecom devices, software and other
peripherals. It enjoys full advantage of USA as home country, as it has a
strong retail network of 273 physical stores whose majority is in USA,
beside the E-retail outlet around the globe. The diversified product
portfolio empowers the apple to strive in tough competition against Dell,
HP & Compaq (Electronista, 2010). Amongst its competitor Apples
outclass profitability is witnessed of its effective diversification efficient
reach of product to customer and state of an art Research and
Development.
Managements Strategy
It is clear from the financial and the strategic analysis of the Apple Inc.
that the management of the company believes in continued research,
innovation and product development. It may be the sole reason that why
the firm avoids the cash dividend and rely over the stock options. Besides
the hardware business of computer the apple is also focus on developing
application software operating system, and all such software application
which added the value of its product. The management is of the view that
R&D, integrated marketing channels and its product diversification is the
source of competitive edge against rivals of its industry. Management is
aware of the need of the investment in the promotion and advertisement
activities; it increases the brand equity, brand loyalty and awareness
about the products. Management also considers focusing on the retail
store as it is the source to remain in contact with customer and a way to
market the product directly; it is also a way to cross sell the market to
customer.

Financial returns in Comparison to Industry
An investor is always keen to know about the profitability. Hence we start
with the assessment of profitability. Apple Inc. has shown a tremendous

improvement in net sales and profitability since 2005 to 2009. In 2008 the
net income increases 75.07% and in 2009 increases 34.58% shown that
Apple cop. is continuously enhancing its profit. Company earning P\S is
also at increasing trend. In 2009 basic EPS is 9.22 from 6.94 last year, and
it was 4.04 in 2007. It should be noted that no cash dividend is announced
since 2005, although stock base benefit and compensation is given. An
increase in return on asset has been observed in 2009 i.e.26.96% against
19.33% last year while industries average is 19.8. Hence Apple is leading
the Industry from this angle. Return on equity is 18.92% into 2009 lower
than 33.40% of industry benchmark, meaning apple is at lower leverage
with a roe increase of 4.03% this year (Hardware Marketplace, 2010).

Financial Risk and Industry
At this stage of our analysis we extend our findings to assessment of risk
associated with the investment opportunities in APPLE Inc. Analyzing the
liquidity we observed that Apple has a sound ability to meet its short term
obligation. It is revealed by the healthy current ratio of 2.74 for the year
2009; it is improved from 2.46 of the last year 2008. If we had a glace on
the industry it reflects a standard of 2.5. In the computer equipment
industry a very low inventory has been observed. That is why the acid test
ratio fall lightly below the current ratio i.e. acid test ratio is 2.70 for the
year 209 in comparison to 2008, which were 2.43. If we compare the acid
test of 2009 i.e. 2.70 with industry average, which is 2.5 (msn.com, 2010).
On the liquidity
situation it is stated that the risk avoider will be glad to look at the
satisfactory liquidity position.

As far as the solvency risk is concern in the long run the debt equity
ratio is 0.11 for the year 2009, which is increased from 0.08 of 2008. Here
it is important to refer to the industry average of 0.07 (OnlyHardwareBlog,

2010). Hence it is apparent that though the APPLE Inc. is more risky in the
long run, but it does not sound like the alarm.

Cash Flow Analysis
Due to the increase in sale the operation of the firm expanded, and
hence besides other assets, the requirement of the cash also increases in
2009. $1.11 billion is generated from operations, which is 5.87% higher
than the last year. The deferred tax expense in 2009 is v1040 million this
noon cash expense last year it was 39 million and 78 million in 2007
(Electronista, 2010).
The company actively invests in marketable securities that not only
improve its liquidity, but rather give a room to meet hazardous need of
raw inventory at any point of time. Investing activities gives negative
balance $ 17.434 billion. It is also clear from the cash flow that firm does
not announce any dividend in cash, rather it takes a tax benefit form stock
base benefit; secondly, firm keeps healthy cash in hand.

Apple and its Main Competitor
When comparing the Apple with its major competitor like Dell & HP,
Apple marks higher price earning ratio of 19.10 times that is greater than
Dell and HP, which is 16 times and
18.3 times respectively. We analyze the share price to book value it is 5.71
times; again higher than 4.1 times of Dell and 1.38 times of HP. Cause of
higher market price is the retention of profit and stock base benefits.
Apple also has high capitalization; the date is $ 250.0 billion (Electronista,
2010).
Apples Performance and Economy
Global economic recession is on the way to recovery, although Europe and
America needs some more time to normalize. However, reasonable growth
is observed in emerging market like Brazil, Malaysia, India and China. Triad
block recorded a poor growth. What is going to be with the world economic
outlook is the global economy is going to revive with the V shape

pattern or its recovery would be like expanded U as some economist say
growth will be slow. I am of the view that Apple Inc. should more focus on
the emerging market like India, China, South Pacific region countries. So
Apple needs to exploit more and more opportunities outside the USA. I am
optimistic that the idea of direct marketing will work out side the USA as
well. Hence Apple needs to introduce maximum retail store outside the
USA.

It is important to look at trend analysis and industry comparisons as a
means of determining if it is the best time to expand or stay put and to
see how its future products will be accepted by the public.


References
Electronista. (2010). Apple only US computer builder to outgrow industry
average. Retrieved
July 2, 2010, from

http://www.electronista.com/articles/10/06/04/isuppli.sees.apple.at.34pc.world.market.share/
Hardware Marketplace. (2010). Computer Hardware. Retrieved July 2, 2010
from
http://www.hardwaremarketplace.com/computer-hardware/
msn.com. (2010). Apple Inc: Key Ratios. Retrieved July 2, 2010 from
http://moneycentral.msn.com/investor/invsub/results/compare.asp?
Page=PriceRatios&Sy
mbol=AAPL
OnlyHarwareBlog. (2010). Highest debt to equity ratio in the computer
hardware industry
detected in shares of international business machines. Retrieved July
2, 2010 from
http://onlyhardwareblog.com/?p=2107
-----------------------------------------------------------

Why do corporations buy back their own stock?
Financial Analysis
Wal-Mart Stores Incorporated operates chain of retail stores in USA as well
as outside the USA. The first Wal-Mart store was opened by Sam Walton in
Arkansas in USA in 1962. Within a span of five years; he opened more stores and
he number increased to 24 stores across Arkansas. The incorporation of Wal-Mart
Stores Incorporated was done in 1969. Wal-Mart grew in the United States of
America by opening of more stores in to the country. The company not only
opened the stores across Arkansas but also across the United States of America
(Wal-Mart Corporate, 2010).
Wal-Mart was opposed by the unorganized retail business holders in the
USA as their business was affected by opening Wal-Mart stores. The company
also opened its first store outside the USA in South America in 1995. Wal-Mart
wanted to spread itself not only to the USA, but in other countries as well. In
2006, the company was having 3800 stores in USA and more than 2980 stores
outside USA making it one of the largest retail chains in the world. This
corporation was also having a vision to establish itself in to a global entity. Wal-
Mart was one of the first companies to operate in the organized retail sector
(Fishman, 2006). The modes of entry used by the company were different for
different countries. Wal-Mart used the mode of entry in to various countries
according to the rules and regulations prevailing in to that country (Wal-Mart
Stores Inc: Financial Statement, 2010).
The sales of the company for the financial year ending in January 2010 are
413.8 billion dollars and income for the same period is 14.7 billion dollars. The
quarterly sales growth for the company has been 5.90%, while the industry
average is 6.80 %. The five-year annual growth in the sales of the company has
been recorded at 7.50 % while five year annual growth of income is 6.58 %. By
analyzing the financial statements of WalMart Incorporated, we find that debt
equity ratio of Wal-Mart is 0.71 on 31st January 2010, which is 0.68 for the
industry. It means the proportion of debt of the company in its capital structure
is lesser than the equity. The company is less leveraged so the interest burden
on the company is minimal. Wal-Mart has capacity to borrow from the market for
its CAPEX in the future. The interest coverage ratio is 13 times in January 2010,
which is 21.9 for the industry. Wal-Mart needs to improve profitability to improve
interest coverage ratio for the reduction of risk of the lenders of the company
(Wal-Mart Stores Inc: Financial Statement, 2010).
The total revenues received by the organization in the year ending January
2010 were $408.2 billion whereas revenues in the year ending January 2009
were $404.3 billion dollars. The revenues in the year ending January 2008 stood
at $377 billion dollars. Thus, it can be easily analyzed that the total revenues of
the organization has grown over the years steadily. This has also impacted the
net income of the organization and thus, increments could also be seen in the
net income of the organization. Net Income, which stood in the year ending 2008
at $12.7 billion, increased to $13.4 billion for the year ending 2009 and again
increased to $14.3 billion in the year ending 2010 (Wal-Mart Stores Inc: Financial
Statement, 2010).
Again if cash flow statement of the organization is analyzed it can easily
be viewed that the cash flow from operating activities have always increased
from the last three years. The cash flow from operating activities stood at $20.6
billion in the year ending 2008 has increased to $23.1 billion for the year ending
2009 and too further increased to $26.2 billion for the year ending 2010. But the
cash flow from investing and financing activities has seen positive and negative
fluctuations both. Here where net cash outflow from investing activities has
decreased first and increased later again. For the year ending 2008, it stood at
$15.6 billion which decreased to $10.7 billion but again increased to $11.6
billion. Again the net cash outflow from financing activities increased constantly
since at the end of year 2008, it stood at $7.4 billion which further for the year
ending 2009 increased to $9.9 billion and further increased to $14.1 billion for
the year ending 2010 (Wal-Mart Stores Inc: Financial Statement, 2010).
Wal-Marts return on equity has improved in the last three years, which is
a good sign for the shareholders of the company. It was 19.9% in January 2008,
which increased to 20.3 % in 2009 and then again marginally increased to 20.4
% in 2010. The return on asset has also shown the same trends in the last three
years. In 2008 the return on asset was 7.9 %. It increased to 8.1 % in 2009 and
then further increased to 8.4 % in 2010. It shows the increase in the efficiency in
the utilization of the assets of the company. The net profit margins have been
almost the same in the last three years in the company. It was 3.4 % in 2008, 3.3
% in 2009 and 3.5 % in 2010 (Wal-Mart Stores Inc: Financial Statement, 2010).
The price to sales ratio and price to book value ratio have shown negative
trends in the last three years, which shows that the stock of the company is
available at cheap price as compare to the price it was carrying three years back.
The price to sales ratio, which was 0.55 in 2008, was decreased to 0.46 in 2009
and then improved to 0.51 in 2010. Similarly, price to book value ratio reduced
from 3.12 in 2008 to 2.83 in 2009 and then improved marginally to 2.86 in 2010.
This represents the better opportunity available for the shareholders to invest in
to the stock of the company. The book value per share of the company has also
increased in the last three years. It was 16.26 dollars per share in 2008, which
increased to 16.63 dollars per share in 2009 and further improved to 18.69
dollars per share in 2010. This represents the increase in the retained earnings of
the shareholders in the company (Shim & Siegel, 2007).
Wal-Marts current assets level has shown stability in the last three years
for the company, which shows the lesser investment in current assets for the
company even with the increased sales. In 2008 the cash and marketable
securities available with the company was 48020 million dollars, which increased
to 48949 million dollars in 2009 and then decreased to 48331 million dollars in
2010.
Quantitative Analysis holds huge significance while evaluating the
financial health of the organization. Three types of techniques are used for
quantitative analysis. The three techniques are trend analysis, common-size
analysis and ratio analysis. Trend analysis is one of the significant quantitative
analysis tools that assist in analyzing the financial health of the company as
compared to its previous years. The year on year trends in the financial
statements are studied to analyze whether organization is improving upon its
past performance or it is further going down (Brigham & Houston, 2007).
Common-Size analysis is another quantitive analysis tool again one of
another tool that helps in making evaluation of the financial health of the
company as against its competitors. The financial statements of the company
and its industry competitors are compared by taking a common base and then
performance is analyzed as against the competitors. It helps in knowing whether
the organization is performing better than its competitors or not. Ratio analysis is
also used to evaluate the financial statements of an organization. This analysis is
used to interpret the performance shown in the financial statements of the
organization. The ratio analysis helps the organization compare performance
over the years or in the same year (Brigham & Houston, 2007).
Quantitative Analysis is used by the company and its stakeholders to
analyze the financial performance of the organization. Trend analysis is used by
the company, the shareholders and the investors to analyze the performance of
the company over the years. Common-Size analysis is used by the competitors,
management, and investors to evaluate the organization that is performing
better whereas ratio analysis is used specifically by all the stakeholders to
interpret clear and well defined results shown in the financial statements of the
company (Brigham & Houston, 2007).
These techniques help to evaluate the liquidity or short-term solvency. By
using current ratio, one can analyze the effectiveness of the liquidity position of
the organization. Profitability of the organization is also analyzed through
profitability ratios, common-size analysis, as it helps to know the organizations
profits earned by the company as compared to others. Trend analysis and ratio
analysis with the help of different asset turnover ratios and trends could easily
analyze that assets are effectively used or not (Brigham & Houston, 2007).
Wal-Marts current stock price is 50.56 dollars. The stock has gone up as
high as 56.27 dollars, and as low as 47.35 dollars in the last year. The earnings
per share of the company which was 3.16 dollars per share in 2008, was
increased to 3.35 dollars in 2009. Earnings per share further increased to 3.76
dollars in 2010. The analysis shows the improvement in the earnings of the
company in the last three year. The current price earnings ratio of the company
is 13.2 which is less than the industry average of P/E ratio of 15 times (Wal-Mart
Stores Inc (WMT), 2010).
Analyzing the stock of the company from the investment point of view, we
can estimates that the fundamentals of the company are very strong. The stock
has return on equity, return on assets better than the industry average of 22.9 %
and 9.1 % respectively. The company has given a better annual average return
on asset and return on equity in the last five years as compared to the industry.
The company has a debt equity ratio and net profit margin, which is less than the
industry. However, Wal-Mart is improving on the efficiency front. As a result, Wal-
Mart stock is recommended for investment.
References
Brigham, E.F. & Houston, J.F. (2007). Fundamentals of Financial Management.
(11th ed.). Cengage Learning.
Fishman, C. (2006). The Wal-Mart Effect: How the World Most Powerful Company
Really Works-- and How it's Transforming the American Economy. Penguin
Group
Shim, J.K. & Siegel, J.G. (2007). Schaum's Outline of Financial Management. (3rd
ed.). McGraw-Hill Professional.
Wal-Mart Corporate. (2010). History. Retrieved July 25, 2010 from
http://walmartstores.com/AboutUs/297.aspx
Wal-Mart Stores Inc: Financial Statement (2010). Retrieved May 31, 2010, from
http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?Symbol=WMT
Wal-Mart Stores Inc. (WMT) (2010). Retrieved May 31, 2010, from
http://finance.yahoo.com/q/co?s=WMT+Competitors
-----------------------------------------------------------
ACC 291 Week 5 Individual Effect of Unethical Behavior

Article Analysis
Write a 350- to 700-word article analysis in which you
identify situations that might lead to unethical
practices and behavior in accounting.
For this week's checkpoint we had to look up

three job postings in the field of accounting. I'm
glad that I got this opportunity because it
actually opened my eyes and expanded my
knowledge in the accounting field. The three job
positions are listed below. The first job title was
Senior Internal Auditor. A Senior Internal Auditor
responsibilities is to plan and perform financial,
operational audits, and identify business process
risk. This job position only specified that the pay
was well over 100k a year!!!! Qualifications
BA/BS, and minimum of 3-4 years public
accounting. The second job posting was a Tax
Manager. Tax Manager is responsible for
conducting basic tax research, maintain tax
records and ensure proper tax accounting. This
position requires a BA in Accounting, and a
minimum of 7-8 years of expereience.The job pay
is listed as 120k!!! The third job posting was
Assistant Corporate Controller- SR Management.
Assistant Corporate Controller- SR Management
position Inventory Accounting for North America,
Credit management for North America and
Corporate accounting for Latin America,
responsible for assuring accuracy of inventory
and sales and works closely with external
auditors on receivable audits. The requirements
for this position is as follows, BA/BS, public
accounting experience preferred, Strong verbal
and written communication. For the Assistant
Corporate Controller- SR Management the salary
pay starts at 110k-130k with bonus and benefits.
I didn't know that Accounting career actually

paid this much. I might think about changing my
careers.
-----------------------------------------------------------
ACC 291 Week 5 Individual WileyPLUSAssignment

we have another New set of week 5 Willyplus assignment which
-----------------------------------------------------------
ACC 291 Week 5 Wileyplus Assignment E7-3, E12-1, E12-8, P12-

9A, P12-10A, E13-3, E13-4, IFRS13-1, P13-2A (New)
Based on what you know about accounting, what role do you see it
playing in business operations? How dependent do you think a
business is on its accounting department? Why?
Accounting plays many important roles especially when it comes to
business operations. Accounting is mainly responsible for almost all
of the financial needs of the business. It keeps track of all spending,
profit and loss that the company inquires.
The business is very dependent on it accounting department.
Accounting department is responsible for monitoring more than the
cash flow, it also works closely with IRS, government to make sure
that everything is being done correctly (payroll, taxes, etc). The
accounting side of the business can be considered to be the lungs of
the company next to the heart.
Why are ethics so important in the field of accounting?

Wow where should I start? First of all the when dealing with
accounting there must be consistent clear communication between
the business and the accounting department. Honesty is always the
best policy. Good ethnics keeps the business running at its top
level. The company's personal information, employee
information could be given to the wrong hands and it can destroy
the company. A good accounting department has way too much to
lose and they will not want to risk a horrible reputation in the field.
Another response
People bring all their financial information to an accountant who
in turn looks through all of it with a fine tooth comb. People need
to know that they can trust this person with all of their personal
information. Most licensed professionals swear to a code of ethics,
whether they follow them or not is up to that professional.
Unfortunately there are many out there that do not and they ruin
the trust for other professionals. Accountants really need to have
the trust of their clients being that they work with peoples taxes and
finances and need much information from their clients.
Another response
Ethics are important in the field of accounting for several reasons.
Ethics mean different things to differnt depending on the role of the
accountant. If an accountant is hired by an individual or a
business, that accountant is trusted with the finances of the person
or business. The accountant is trusted to give an honest account of
finances and not to defraud or jeopardize that individuals or
companies relationship with the government, creditors of
financiers. Individuals and businesses also trust the ethics of
accountants insofar that they do not disclose their information to
those that do not have a right to it. Finally, In the accounting
profession, much like many other professional service professions,
an accountants reputation is the continuing source of employment.
If they are knows to have a bad or even flexible ethical code then
they can develop a bad reputation and experience a loss of business.
-----------------------------------------------------------
ACC 291 Week 5 Learning Team Ratio Analysis Memo

Resource:Virtual Organizations
Click the Virtual Organization link on the student
website to access the Virtual Organizations.
Financial Statements
Today, I will be describing a balance sheet,

income statement, retained earnings statement,
and statement of cash flows and how a company
uses these financial statements as a tool to make
future decisions for the company.
Balance Sheet
A balance sheet a statement sheet that reports
the companys financial balances of the
business. This sheet includes the companys
total of assets and liabilities. It is used for all
three types of business sole proprietorship,
business partnership and corporate business
companys. Creditors rely on this financial sheet
to determine if the company will be able to
repay.
Income Statement
An Income Statement is a financial statement
that shows the companys profit and losses. It
basically shows all the companys gains and
losses that were made during a period of time.
After the company deducts the expenses from
the revenue then you will get a total net income.
This is a great statement to use especially
because this will show investors how much net
income is the company bringing in, or how
financially stable the company truly is.
Retained Earnings Statements
Retained Earnings Statements reports the
changes to the retained earnings (net income in
a corporation) during a certain time period. This
financial statement shows dividends, profits and
loses. Investors and Lenders monitor the
retained Earning Statements especially when it
comes to monitoring dividends. Some invest use
this tool to see if the company is paying high/low
dividends. Retained Earnings Statement is part
of the balance sheet under Stockholders equity.
Statement of Cash Flow

Statement of Cash Flows provides information
regarding the companys cash receipts. This
statement gives a detailed account of the
operating, investing and financial activities of
the company. It also allows investors a chance to
observe how financially stable the company is so
that they can make a choice if they want to take
a risk on investing into the company. Also the
accounting department needs this statement in
order to see if the company has enough money
for payroll uses.
All four of these financial statements are all

extremely important tools to use in the business.
Another statement that was not listed but is
often used is called comparative statements.
Comparative statement gives a side by side
comparison of the financial statements above.
Reference
http:yourdictionary.com
/accounting_statements.org Retrieved 1/28/10
Thomas, Y. 2005-08-27 Accounting 101 pg. 52
Statements
-----------------------------------------------------------

Discuss the objectives for Week Five. Your discussion
Compare and contrast sole proprietorships,

partnerships, and corporations.
Sole proprietorships means that a business that
owned by one person. That includes and not
limited to all profits and losses, debts and
unlimited liability, all will come from the solely
one owner and not a group or in this case a
partner or co-owner etc. Partnerships are seen
much differently than sole proprietorships.
Partnerships is a business that owned by more
that one person/s. This is the number one
difference from being a sole proprietorship or
sole owner. Basically, two or more people come
together and split the cost, debts, and liability.
Corporations is an business that has separate
entity owned by stockholders. The huge
difference between corporations and the other
two is that they are owned by stockholders.
Stockholders make decisions that is first best for
their company, secondly the company that they
have together.
Why would a entrepreneur want to choose one
over the other?
An Entrepreneur is a person that wants to start a
business with their vision and have more power
of the decision making. The best choice for an
entrepreneur is to choose sole proprietorship out
of all the three choices. The first and most
important reason is because it is much easier to
start a business as sole proprietorships. Sole
proprietorship takes all the profit that and
doesn't have to split it between any other
owners or corporations.
If I was to start a new business which one would
I choose?
In this case it depends on the type of business.
My case I will be opening a hair salon and I would
prefer sole partnerships. i choose that because I
want to be in control and I don't want to split the
profit.

ACC 291 GENIUS Perfect Education

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

ACC 291 GENIUS Perfect Education

Uploaded by

Copyright:

Available Formats

ACC 291 Entire Course and Final Guide

FOR MORE CLASSES VISIT

ACC 291 is a online tutorial store we provides ACC 291

ACC 291 Final Exam Guide (New)

FOR MORE CLASSES VISIT

Based on what you know about accounting, what role

Budget Definition Desc

Production budget A production of units needed to be Shows manage

Direct materials budget Is the estimated quantity or cost of Shows manage

Direct labor budget A estimate of cost and quantity of Shows how ma

Budgeted income statement Estimate of expected profitability of Is a very impor

Cash budget A projection of expected cash flows Cash budget he

ACC 291 Final Exam Guide 1

FOR MORE CLASSES VISIT

Discussion Question 1: Post your response to the following:

You know how important it is to create budgets for your

Budgeting is a very important skill that can be applied to everyday

In a business, a budget helps a business make good decisions because

Discussion Question 2: Post your response to the following:

What are some of the different types of budgets?

Describe in detail one type of budget covered in the text.

Describe what the budget is used for and what information it

Discuss how a business benefits from each of the budgets.

I chose to write about the Production Budget. The Production Budget

Budget sales units + Desired ending finished goods units - Beginning

ACC 291 Final Exam Guide

FOR MORE CLASSES VISIT

IFRS Multiple Choice Question 01 What is a Flexible

A Flexible budget is a budget that change

The steps to development a flexible

a) Identify the activity index, and the range of

b) Find out what the variable cost, and

c) Find out what the fixed cost and determine

The information found on a flexible

The information on the budget is a great

ACC 291 Week 1 Assignment Comparative Analysis Problem

FOR MORE CLASSES VISIT

On a personal note I would like to thank you Jess. If it

ACC 291 Week 1 Discussion Question 1

FOR MORE CLASSES VISIT

DestinyWear Accounting Department

DestinyWear Accounting Staff

FOR MORE CLASSES VISIT

Costco Wholesale Corporation

$1,150,000 Net Income

Debt ratio as percent of total asset

As we can see that the debt as percent of total equity is declining in

ACC 291 Week 1 Wileyplus Assignment E8-4, E8-11, BYP8-

FOR MORE CLASSES VISIT

Exercise 8-4 Wainwright Company

Exercise 8-11 Fedex Corporation

Go to the U.S. Securities and Exchange Commissions Web site

U.S. Securities and Exchange Commission (SEC)

Financial Accounting Standards Board (FASB)

The Sarbanes-Oxley act has many provisions to give companies

Another provision pertains to the "management assessment of

The Sarbanes-Oxley act is designed to help companies promote

The law prohibits falsifying information, failing to notify of material

FOR MORE CLASSES VISIT

Fordyce Electronics issues a $400,000, 8%, 10-year mortgage note

ACC 291 Week 2 Assignment Financial Reporting Problem,

FOR MORE CLASSES VISIT

Differentiating Depreciation Methods