Showing posts with label Accounting. Show all posts
Showing posts with label Accounting. Show all posts

Community Medical Imaging Case Solution

22:10 Posted by Unknown ,
Case Solution for Community Medical Imaging by Elizabeth M.A. Grasby, Jessica Kelly

Abstract:
In early February 2009, a radiologist with Community Medical Imaging (CMI), in London, Ontario, was approached by the Timmins District Hospital chief about providing on-call service to Timmins and the surrounding area. The hospital’s current provider had decided to relocate to the United States and could no longer provide service. The chief was hoping CMI could take on the extra workload. The radiologist knew this job would provide interesting work for CMI’s radiologists and would improve CMI’s presence across the province, but simultaneously would place an increased demand, both professionally and personally, on the entire team. Other radiology groups would be interested in this job, so the radiologist needed to accept or reject the job as soon as possible.

Keywords: 
Accounting, Community Medical Imaging Case Solution

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Kreative Kasuals Inc. Case Solution

03:05 Posted by Unknown ,
Case Solution for Kreative Kasuals Inc. by Elizabeth M.A. Grasby, Kevin Dean

Abstract:
The owner of a small Ontario-based textiles manufacturer must decide whether to bid on two government tenders and, if so, at what prices. The owner must analyze each bid by calculating its direct, absorption, and full costs, consider the impact of adding each bid’s volume to the company’s current capacity level, and determine the differences between a one-time and multi-year tender contract. The owner also wants to look at the overall “fit” of the contracts with the company’s current operations and direction.

Keywords: 
Cost Accounting, Management Accounting, Pricing, Canada, Kreative Kasuals Inc. Case Solution

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Prelko Marketing Systems Inc. Case Solution

12:40 Posted by Unknown ,
Case Solution for Prelko Marketing Systems Inc. by Elizabeth M.A. Grasby, Eli Gladstone

Abstract:
The president and chief executive officer of Prelko, a firm that, among other services, provides personalized printing for large companies, must decide if a new printing software application from Europe is appropriate for use by the company. The company’s printing business has been in decline and the president must determine whether the company should cease offering printing services entirely to its customers, or if there is a profitable way to reinvigorate the printing line of the business.

Keywords: 
Cash Flow, Branding, Industry Analysis, Cost/Benefit Analysis, Differential Analysis, Canada, Prelko Marketing Systems Inc. Case Solution

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Lehman Brothers' Fall Case Solution

02:44 Posted by Unknown ,
Case Solution for Lehman Brothers' Fall by Ram Kumar Kakani, Vasudha Singhania, Martin Stack

Abstract:
This case describes the financial undertakings of Lehman Brothers Inc., which was once the fourth-largest investment bank in the world. On September 15, 2008, less than a year after the bank presented its largest profit ever, the world watched its decline. In terms of size of assets, Lehman is considered the largest bankruptcy in history, with assets totaling US$639 billion and liabilities of US$613 billion. The U.S. credit crisis had uprooted the strength of Wall Street, with Lehman announcing a petition it filed under Chapter 11 of the U.S. Bankruptcy Code. The bankruptcy raised some interesting questions, the biggest among them being: How could a large company such as Lehman, with a record of reporting huge profits, become so helpless that it had to file for bankruptcy?Undoubtedly, the financial scenario in the United States had become dire, especially for those companies involved in mortgage banking. Lehman had some additional drawbacks. This case deals with a couple of these problems, one of them being the accountancy of its Repo 105 transactions. The modus operandi of the company has been unveiled to show how it managed to hide its true financial state through gaps in the financial reporting system and remain clean-handed for years.

Keywords: 
Financial Reporting Standards, Accounting Transactions and Practices, Bankruptcy, Banking, Wall Street, United States, United Kingdom, Lehman Brothers' Fall Case Solution

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Sloboat Shipping Inc. Case Solution

15:14 Posted by Unknown ,
Case Solution for Sloboat Shipping Inc. by Elizabeth M.A. Grasby, Jaclyn Cairns

Abstract:
The accountant of a cargo shipping company must update the financial position of the company. He has a list of the company’s cash receipts and disbursements, the statement of financial position, and the bookkeeper’s detailed notes pertaining to transactions for the current year.

Keywords: 
Accounting Transactions, Investments, Canada, Sloboat Shipping Inc Case Solution

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H&L Pines Case Solution

15:13 Posted by Unknown ,
Case Solution for H&L Pines by Elizabeth M.A. Grasby, Jaclyn Cairns

Abstract:
The sole shareholder of a national supplier of evergreen trees is expanding its product line. This expansion requires a $6.5 million investment. The company decides to finance this expansion through the issuance of bonds and must record the accounting entries involved with this issuance, along with the related interest payments and amortization of the bonds.

Keywords: 
Accounting Transactions, Investments, Bonds, Canada, H&L Pines Case Solution

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Duffinbear Inc. Case Solution

15:11 Posted by Unknown ,
Case Solution for Duffinbear Inc. by Elizabeth M.A. Grasby, Eli Gladstone

Abstract:
Rob Hantziano, president and founder of Duffinbear Inc., must review the various financing and investing transactions that have taken place over the fiscal year 2011.

Keywords: 
Accounting Transactions, Investments, Canada, Duffinbear Inc. Case Solution

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Tempest Tech Incorporated Case Solution

15:10 Posted by Unknown ,
Case Solution for Tempest Tech Incorporated by Elizabeth M.A. Grasby, Karim Mashnuk

Abstract:
A sophisticated technology company located in Mississauga, Ontario, began operations on February 1, 2011. Initially, the company raised funds through the issuance of common stock. In mid-2011, new software development was put on hold due to increased concerns over patent protections. In June 2011, the company sought appropriate investment vehicles for its excess cash, which would provide investment income over a set period of time.

Keywords: 
Accounting Methods, Securities, Technology, Canada, Tempest Tech Incorporated Case Solution

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Lowe's Companies, Inc. Case Solution

15:08 Posted by Unknown ,
Case Solution for Lowe's Companies, Inc. by Elizabeth M.A. Grasby, Ian Dunn

Abstract:
Crystal Anderson was evaluating her investment portfolio. She was searching for new equities to purchase before the end of the current RRSP season and wanted to diversify her current holdings by investing in the home improvement retail industry, specifically in Lowe’s Companies, Inc. Lowe’s, headquartered in the United States, was a major home improvement retailer and was currently undergoing an expansion into the Canadian market. She had just received the company’s annual reports with its last three years’ financial results. She wanted to assess the retailer’s past financial performance, including the risks and opportunities associated with the industry and the retailer’s corporate strategy. She would decide whether to invest in Lowe’s, based on her analysis.

Keywords: 
Financial Analysis, Financial Ratios, Investments, Stock Market, Home Improvement, United States, Lowe's Companies Inc. Case Solution

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Damn Heels (A) Case Solution

15:06 Posted by Unknown ,
Case Solution for Damn Heels (A) by Elizabeth M.A. Grasby, Nadine Ramrattan

Abstract:
A young business student at a university in Ontario must decide whether to launch her entrepreneurial venture — selling women’s foldable flats — and how, in the Toronto market. Damn Heels (A) highlights the research done by the entrepreneur leading up to this decision, including the marketing (product, price, promotion, and placement) decisions she faces, consideration of the competitive retail shoe industry, and some of the first steps for a new business evaluation — unit contribution and financial profitability projections.

Keywords: 
Unit Contribution, Break-even Analysis, Fixed and Variable Costs, Market Entry, Financial Projections, 4 Ps, Canada, Damn Heels (A) Case Solution

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The Good Night Motel Case Solution

20:17 Posted by Unknown ,
Case Solution for The Good Night Motel by Richard H. Mimick, David C. Shaw, Elizabeth M.A. Grasby, Raymond W. Leduc

Abstract:
The Good Night Motel is considering offering special pricing for a two-day church convention event involving 20 rooms. This requires the owner to perform contribution analysis, sensitivity analysis, and some qualitative analysis.

Keywords: 
Cost Behaviour, Break-even, Qualitative Analysis, Canada, The Good Night Motel Case Solution

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Cafe Xaragua Case Solution

10:28 Posted by Unknown ,
Case Solution for Cafe Xaragua by Mary Gillett, Robert Lehnert

Abstract:
While on a visit to Haiti, a student entrepreneur realized the potential for economic development in a country that was rich in certain resources and virtually unexplored by the private sector. The entrepreneur decided on coffee as a business opportunity and he and his three partners imported their first burlap sack. By November 2011 the product was for sale - a premium coffee from Southeastern Haiti with a brand focused on assisting the redevelopment and sustainability of the Haitian coffee industry. After the product met success, the entrepreneur and his partners were ready to make an additional investment. They believed that a café focused on their own brand of Haitian coffee would be a great way to generate sales and further develop their product offering before pursuing a grocery-store strategy. However, they also knew that such an investment would be risky.

Keywords: 
Contribution Analysis, New Venture, Branding, Sustainable Development, Canada, Haiti, Cafe Xaragua Case Solution

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Arthur Brothers Construction Ltd. Case Solution

09:53 Posted by Unknown ,
Case Solution for Arthur Brothers Construction Ltd. by Elizabeth M.A. Grasby, Jessica Kelly

Abstract:
A general contracting company specializing in the construction of single-family homes was known for its exceptional craftsmanship and was, therefore, highly sought after during the busy construction season from late spring to early fall. As a result, clients secured a spot in the company's schedule by paying deposits. This left the company with excess cash during the off-season, which it invested each year in trading investments. The case centres on the transactions associated with these short-term trading investments.

Keywords: 
Accounting Principles, Accounting Transactions, Investments, Canada, Arthur Brothers Construction Ltd. Case Solution

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Davis, Ellis & Thurn LLP Case Solution

09:47 Posted by Unknown ,
Case Solution for Davis, Ellis & Thurn LLP by John S. Haywood-Farmer, Megan McNevitts, Meg Vito

Abstract:
A senior manager at the Toronto office of accounting firm Davis, Ellis & Thurn (DE&T) reflected on last year's Upper Canada Bank (UCB) audit and wondered how he should plan for the upcoming 2012 audit. The senior manager was responsible for overseeing the audit of UCB's retail segment (UCBR). Specifically, he was concerned about the test-of-controls portion of the UCBR audit, since the team had faced some challenges the previous summer. For years, UCB had been a client of DE&T, but it was only in 2011 that the firm had bid on and was granted the test-of-controls portion, which had formerly been completed on behalf of DE&T by UCB's internal auditors. Now, reflecting on the previous year's engagement, the senior manager wondered what changes he would make with respect to budgeting, staffing, and training, and to the client relationship in order to ensure that the client was satisfied and the UCBR audit remained profitable.

Keywords: 
Auditing, Budgeting, Control Systems, Cost Control, Professional Firms, Customer Service, Canada, Davis Ellis & Thurn LLP Case Solution

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Alleged Accounting Fraud at Nortel Networks Corporation Case Solution

09:33 Posted by Unknown ,
Case Solution for Alleged Accounting Fraud at Nortel Networks Corporation by Darren Henderson, Chris Sturby, Christine Liu

Abstract:
In January 2009, an investor was assessing his investment in Nortel Networks Corporation. Nortel had recently filed for bankruptcy protection in the United States and Canada, meaning his entire original investment was almost certainly lost. Nortel had filed a total of four accounting restatements from 2003 to 2007, leading to class-action lawsuits from investors and investigations by the U.S. Securities and Exchange Commission (SEC) and the Ontario Securities Commission (OSC). Considering his losses, the investor wondered whether there were any signs indicating that Nortel's accounting practices were problematic. He also wanted to understand the accounting issues raised in the SEC and OSC investigations, such as improper recognition of revenue and improper recording of provisions. Overall, the investor wanted to learn from his loss with Nortel to make stronger future investing choices.

Keywords: 
Corporate Governance, Accounting Fraud, Revenue Recognition, Provisions, Canada, Alleged Accounting Fraud at Nortel Networks Corporation Case Solution

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Capitalization of Costs at Salesforce.com Case Solution

09:29 Posted by Unknown ,
Case Solution for Capitalization of Costs at Salesforce.com by Darren Henderson, Chris Sturby, Jessica Kelly

Abstract:
An investor wishes to make an investment in a software/information technology company. The investor is intrigued by the growth prospects of firms in the cloud computing industry and is deciding on whether to make an investment in the common shares of Salesforce.com. While the industry appears to be very attractive, concerns have been raised in the financial media over the company's accounting policy decisions, particularly the decision to capitalize software development costs (internally developed intangible assets) and sales commissions. Concerns have also been raised over the company's focus on metrics outside generally accepted accounting principles. Students are asked to evaluate the company's accounting policy choices and are provided with relevant information regarding the company's business model, existing and proposed accounting standards (both under U.S. GAAP and IFRS), and the accounting policies of competitors. After evaluating the accounting policies, students may then conclude whether any adjustments should be made to the financial statements and determine how this impacts valuation.

Keywords: 
Accounting Policy Choice, Intangible Assets, Capitalization, Non-GAAP Disclosure, United States, Capitalization of Costs at Salesforce.com Case Solution

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Rothmans Inc. — The Curious Case of the Interest Rate Swap Case Solution

08:27 Posted by Unknown ,
Case Solution for Rothmans Inc. — The Curious Case of the Interest Rate Swap by Karen Lightstone

Abstract:
This case provides students with an opportunity to evaluate the mechanics and effectiveness of an interest rate swap in an actual situation. Rothmans Inc. entered into an interest rate swap in 2001, and the company’s public financial statements allow readers to follow the swap through several years until the eventual early pay-off in 2005. Students can determine if the decision to exit the interest rate swap early was good or bad. Rothmans has only one five-year bank term loan and one interest rate swap covering half of the value of the loan. This simplicity provides an excellent learning environment using publicly available data.

Keywords: 
Interest Rate Swap, Discount Rate, Present Value, Fair Value, Rothmans Inc. The Curious Case of the Interest Rate Swap Case Solution

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Selecting a Pharmaceutical Company from Northeast Asia for Investment Case Solution

07:57 Posted by Unknown ,
Case Solution for Selecting a Pharmaceutical Company from Northeast Asia for Investment by Ho-Young Lee, James Russell Shaw Jr., Moon-Kyung Cho

Abstract:
Joe Clift, a co-founder and managing partner of private equity firm Blacksmith Partners LLC in New York, managed his company's emerging market funds for several industries. He planned to add one company from Northeast Asia to generate growth in his pharmaceutical industry portfolio, and had focused on three outstanding pharmaceutical companies: Takeda Pharmaceutical Company Ltd. from Japan, Dong-A Pharmaceutical Company Ltd. from Korea, and Sinovac Biotech Company Ltd. from China. All three companies had shown strong growth in their respective markets over the years. Japan, the number-one pharmaceutical drug consumer in Asia, was also the second-largest individual market in the world, behind the United States. Japan generated sales of $60 billion, which constituted approximately 11 per cent of the global market in 2006. Korea maintained a competitive domestic market share supported by an excellent national health insurance system and high research power. Korea was the fourteenth-largest drug consumer in the global market as of 2008. China, being one of the fastest-growing pharmaceutical markets, was the second-largest pharmaceutical drug consumer in Asia. With an ever-growing population of senior citizens in Northeast Asia, the managing partner predicted strong potential growth in drugs for chronic diseases in these emerging markets. Which company should Clift choose among these three companies, and why?

Keywords: 
Pharmaceutical Industry, Northeast Asia, Financial Statements, Stock Investment, Korea, China, Japan, Selecting a Pharmaceutical Company from Northeast Asia for Investment Case Solution

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BNL Stores Case Solution

07:55 Posted by Unknown ,
Case Solution for BNL Stores by Vaughan S. Radcliffe, Paul Cruz

Abstract:
The case requires students to conduct a financial analysis of BNL Stores, a retail business. Case materials include a multi-year balance sheet, an income statement and statement of cash flows data. Students will prepare and interpret selected ratios, and prepare a basic statement of cash flows.The case entails use of financial statement analysis, balance sheets and income statements to provide a complete picture of an organization's financial health. Data for the case are disguised and are drawn from the published financial statements of a major retailer that went bankrupt. The collapse of companies in similar circumstances influenced the Financial Accounting Standards Board's moves to require a statement of cash flows and was historically significant.

Keywords: 
Cash Flow, Ratio Analysis, Financial Statements, Bankruptcy, United States, BNL Stores Case Solution

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Rawhide Brewery Case Solution

03:31 Posted by Unknown ,
Case Solution for Rawhide Brewery by Michele Stewart

Abstract:
Rawhide Brewery (Rawhide), a small Canadian brewery, is considering an opportunity to share its excess production capacity with another brewery, Tabby Cat Beer (Tabby). Three proposals are under consideration, each requiring a different accounting treatment by Rawhide. The first option is an arrangement under which Tabby would outsource its production to Rawhide. The second is a more complex arrangement under which both parties would invest in the common shares of a newly formed entity into which Rawhide would transfer its existing brewery operations and related debt. Because Rawhide would guarantee the debt of the new entity, it would make all key decisions. Under the third alternative, Rawhide would own 60 per cent of the common shares and Tabby would own the remaining 40 per cent, and all key decisions would be made jointly by both parties. The CFO of Rawhide has been asked to assess the accounting implications, advantages and disadvantages of the various options, taking into account the impact on Rawhide’s debt-to-equity ratio.

Keywords: 
Joint Ventures, Consolidation, Variable Interest Entity, Accounting Methods, Canada, Rawhide Brewery Case Solution

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