Day_7_Cashflow-Lecture-1

Day_7_Cashflow-Lecture-1 - 1 Review Accounting Cycle...

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Unformatted text preview: 1 Review Accounting Cycle & Basic Accounting Terms PROFESSOR SOLOMON N. DARWIN 2 Solutions to Conceptual Problems 1 2 3 4 5 6 7 8 9 10 11 12 13 14 3 Solutions to Conceptual Problems 1. Adac Lavatories: Nuclear medical device ($30M from 1996 to 1998) 5,6 2. Amazon. Com 3 3. AOL: Internet Access- ($236M in 1997) 6 4. Bausch and Lomb: Contact lenses (1993 to 1994 $43M) 5 5. Boston Chicken: Restaurants 5, 9, 10 6. Boston Chicken: Restaurants (Franchise) ($10M in 1996) 9,6 7. Bre X: Gold Mining (2001) 10 8. Chambers Development: Landfills -($72M in 1992) 9 9. CISCO: Internet Equip-($2.5 B in 2000) 9 10. Coca Cola: Beverages 6,9 11. Dynergy, CMS Resources, Reliant: Energy 10 12. Elan Pharmaceutical: Drugs- $400M in 2000 and 2001 10 13. Etoys, Inc 3 14. General Electric: Power plant -($100M in 1998) 9,6 15. General Motors: Auto Manufacturing (Suspicious but not a violation) 9,6 16. Goodyear: Tires 2000 9 17. Informix: License software agreements (From 1994 to 1997 - $295M) 10 4 Solutions to Conceptual Problems 1. JP Morgan 3, 9 2. Lee Pharmaceuticals: Liability not accrued until 1996. 3, 9 3. Lockheed: Aircraft Manufacturing ($730M in 1981) 9 4. Lucent Technologies: Electronic Equipment ($679 million from 1999 to 2000) 10 5. Lucent: Technology ($94M in 1997) 10, 6 6. Lucent: Technology ($54M in 1996) 9 7. McAfee: Virus Software ($600 M from 1998 to 2000) 10 8. MiniScribe: Comp Disks - (1999) 10 9. Orion Pictures: Movies (Wrote off $75M in 1991). 9 10. Phar Mor: Retail Store 10 11. Southwest Airlines 9 12. Structural Dynamics: Mechanical Design Software ($91M from 1992 to 1994) 10 13. Sunbeam: Consumer products ($60M in 1999) 9 14. Suprema Specialties: Cheese production ($700M from 1998 to 2002) 10 15. TYCO - its goodwill was more than physical assets, more liabilities than assets 1 16. World Com: Telephone-($15 Billion from 1999 to 2003) 9,6 17. Xerox: Laser copier leases ($6 Billon -1999) 5,6 5 Cost Flows 6 Flow of Costs 7 Cost Flows Through the 3 Business Sectors Manufacturing Merchandising Service 8 Differences in Focus Manufacturing Merchandising Service Procuring tangible products, then distributing them to customers. Delivering marketable services (legal advice, education, transportation, etc.). Using labor and/or machinery to convert raw materials into marketable products. 9 Differences in Resource Investment Manufacturing Merchandising Service Generally to purchase inventory from manufacturers and resell it to customers. Building large factories, hiring managers, and employing production personnel to convert raw materials into final products. Railroads, airlines, etc.: large assets. Accounting, law firms, etc.: paying for expertise of professionals. 10 Product Costs Manufacturing Merchandising Service Labor, supplies, and other costs directly related to provide services....
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This note was uploaded on 03/29/2011 for the course ACCT 102B taught by Professor Solomondarwin during the Spring '11 term at Berkeley.

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Day_7_Cashflow-Lecture-1 - 1 Review Accounting Cycle...

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