Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
Nike
In its 2016 Form 10-K, on page 106, Nike notes its policy with respect to depreciation as follows:
Depreciation is determined on a straight line basis for buildings and leasehold improvements over 2 to 40 years for machinery and equipment over 2 to 15 years.
Depreciation and amortization of assets used in manufacturing, warehousing, and product distribution are recorded in Cost of Sales. Depreciation and amortization of other assets are recorded in Operating Overhead Expense.
If Nike has incorrectly estimated the useful life, and the asset is impaired, it has a process for the impairment of such assets. The company would impair the asset on its remaining book value less the expected future cash flows from having the asset. If the asset is useful for longer than its book value, there is nothing that needs to be done. The purchase has been fully depreciated, so the asset has no more book value -- there is no expense associated with whatever economic benefit that such an asset has as the company has already received all of the economic benefit of the purchase.
A balance sheet is the statement that highlights...
The principle is that all assets of the company are acquired either via debt or via equity. The value of the company is the value of the assets less the debts that the company has.
The statement of cash flows is the statement that highlights the cash flows. It is divided into three different types of cash flows -- operating, investing and financing -- to reflect these distinctly different activity types.
The income statement highlights the accounting income for the company. This starts with the revenues, from which different expenses are deducted. At the end of the income statement is the net income for the company.
Revenue recognition policies are the rules by which revenue is recognized. This includes the timing of revenue transactions in particular -- as in determining at what point revenue is recorded.
Cash is cash., and this category usually includes cash equivalents, which are money market securities of less than three months.
Accounts receivable are sales that have been made for which payment has not yet been collected. In other words, this is the…
This enables the company to better match its inflows and outflows. However, this also means that much of what constitutes earnings is not a direct, immediate cash flow. There are a number of items that will appear on an income statement that are either flows that have already occurred, or are flows that have not yet occurred. However, because the transaction was based in that quarter or year, it
Cash Flow The different authors use a number of quantitative approaches to understanding firm performance. Paunovic (2013) discusses the pricing and valuation of swaps. The author seeks to "demystify the structure of these financial derivatives (swaps) by presenting their valuation methods and by showing how they are used in practice." Thus, the author is presenting textbook explanations of swaps to her audience. Swaps are priced at par at the present time.
Cash Flow Analysis Discuss Cash Flow And Its Analysis Financial Leverage Financial leverage refers to the use of a company's assets and liabilities targeting to earn profits upon balancing the risks associated. Financial leverage follows the argument in physics of lever where little force is used to lift heavy objects. Financial leverage uses debts and stock (Preferred stock) to increase earning. Leverage is a significant measure that financial institutions use to increase benefits
A second challenge organizations face with cash flow management is being realistic with the amount of time it will take for them to receive revenues. This negatively affects cash flow projections that Sprague illustrates as being very important to a company's success. Companies are become slower and slower to pay their vendors, with 45 to 60 days becoming more the norm than the traditional 30 days, according to Feldman,
Airline Performance Review and Analysis TKL Air Lines will be an American Airline that will be operating in the multiple routes across North America in the United States, Canada and Mexico. TKL will provide the cargo and passenger services serving more than 30 destinations. The company will also be serving up to 10 million customers yearly, and more than 1,500 customers for the daily flight. TKL's major activities will include inbound
Financial Calculations The Pickens Mining company has to make a decision with respect to whether or not it wants to develop a strip mine. Doing this is to fulfill a contract that it does not currently have. The decision needs to be based on careful analysis of the different cash flows, ensuring that only those incremental to this decision are included. In a capital budgeting situation, only the incremental cash flows