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Chapter 1 Powerpoint - Research In Motion Nasdaq RIMM How...

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Research In Motion Nasdaq: RIMM
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How does RIM make money?
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Product Money-Making Details: Over 80% of revenue is from “devices”, with an average sales price of $330. 36.7 million devices were sold last year.
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Breakdown of inventory
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Torch : Material ‘costs’ $171 (sales price = $199)
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Cost is an imprecise word For GAAP purposes: 1. Product costs Associated with the manufacture of goods or the provision of services 2. Period costs (non-production costs) All other costs
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Examples: Period / Nonproduction Costs General Administration Designing Developing Distribution Customer Service Marketing
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GAAP-base ‘Full Cost’ for companies making tangible products Materials Labor Overhead $171 per Torch (per the WSJ ) ????????????????????
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Managerial & Financial Accounting “Unexpired” Costs are Assets Period  Cost Expense COGS Asset Product  Cost RIM’s $622 million of inventory is an asset
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Typical Textbook Example ABC Company began the month with $8,600 in materials inventory.
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