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Sale of Accounts Receivable
The Company sells undivided interests in designated pools of qualified accounts receivable to a securitization vehicle (a qualifying special purpose entity). The Company utilizes securitization as a "financing technique" (e.g., to reduce more expensive bank debt - the interest rates the company obtains on notes issued by the qualifying special purpose entity are lower than the company could get on its own bank debt). The Company services, administers and collects the receivables on behalf of the purchaser. The agreement includes certain covenants and provides for various events of termination. The agreement also requires that proceeds from securitization be used to pay down Company debt. During the current year, $11 million of receivables generated from sales of the Company's inventory were sold under the agreement, and, therefore, are not reflected in the accounts receivable balance in the Company's balance sheet.
Determine the appropriate cash flow statement treatment - classification (e.g., operating, investing, financing) and timing, if applicable, - for the above transactions.
Discuss the proper accounting treatment of $273,000 ($714,000 − $441,000) by which the cost of the first machine exceeded the cost of subsequent machines.
When Congress passes a statute with language such as, "The Secretary shall prescribe such regulations as he may deem necessary," the regulations ultimately issued for that statute are:
Based on industry experience, warranty costs are estimated at 2% of sales in the year of sale, 4% in the year after sale, and 6% in the second year after sale. Sales and actual warranty expenditures for the first three-year period were as follows:
The gross earnings of the factory workers for Vargas Company during the month of January are $66,000. The employer's payroll taxes for the factory payroll are $8,000.
The Richmond Company uses the weighted-average method in its process costing system. The company has only a single processing department.
From the standpoint of the stockholders of a company, the ratio that measures the overall performance of a company would be calculated using which of the following?
Given the income statement above, what are their tax bases in their shares at the end of year 1?
On December 31, 2006, Crawford Co. estimated that 1.5% of its net sales of $400,000 will become uncollectible.The company recorded this amount as an addition to Allowance for Doubtful Accounts. On May 11, 2007, Crawford Co.
Crow Co. issued 493,000 of 10%, 20 yr. bonds on Jan, 1, 2010, at face value. Interest is payable annually on Jan. 1. Prepare journal entries to record the last of the following events:
Leon Tyler's VISA balance is $793.15. He may pay it off in 12 equal end-of-month payments of $75 each. What interest rate is Leon paying?
Starr Company purchased a depreciable asset for $15,000. The estimated salvage value is $10,000, and the estimated useful life is 8 years. The double-declining method will be used for depreciation. What is the depreciation expense for the 2nd year..
Prepare a statement of cash flows (indirect method)for walker corportion for 2010. The 2010 and 2009 balanccer sheets of walker corporation follow. the 2010 income statement is also provided.
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