Reference no: EM13747690
Harley-Davidson was highly profitable, had one of the world's most valuable brands, and by the end of 2008 had repurchased $4.7 billion of its common stock. Harley-Davidson Financial Services made low-risk loans to Harley retail customers and then sold those receivables to Harley-Davidson Motorcycle Trust. The Motorcycle Trust sold notes backed by the motorcycle receivables to institutional investors. Harley-Davidson's highly loyal customers rarely defaulted, so the Motorcycle Trust sold notes equal to about 93-96% of the face value of the receivables collateralizing the notes.
The subprime securitization market collapsed in late 2007 and entire securitization market effectively closed in the second quarter of 2008. From then through June 30, 2009, the Motorcycle Trust was unable to sell notes backed by Harley-Davidson receivables. As a result, "Finance receivables held for sale" increased from $781 million on December 31, 2008, to $2.444 billion on December 31, 2009. To finance those receivables, Harley-Davidson increased its debt by over $2 billion.
Harley-Davidson's pension and retiree health care funds also suffered major losses. Possibly because of Harley's weaker financial condition, its reserve accounts for items such as receivables and warranties seemed far less conservative at the end of 2008 than at the end of 2007.
Does Harley-Davidson have adequate allowance/reserve balances in : (a) warranty and safety recall liability; (b) accounts receivable; (c) finance receivables held for investment; (d) finance receivables held for sale, and (e) inventories? Are these balances more or less adequate than in the past? Explain in a paragraph.
|
Calculate the amount the hospital
: Calculate the amount the hospital would report as net patient service revenue in its statement of operations for the fiscal year ending Sept. 30, 2011.
|
|
Firm income tax liability
: ABC company had a taxable income of $187,859 from operations after all operating costs but before interest charges of $59,616, dividends received of $74,677, dividends paid of $5,000, and income taxes. What is the firm's income tax liability?
|
|
Foreign corporation through the transfer of property
: You have been hired by a U.S. corporation that wants to form a foreign corporation through the transfer of property. Propose a strategy for the client to transfer property into the foreign corporation that will help the client to avoid or mitigate..
|
|
Why violence break out in kansas after passage of kansas-act
: Why did violence break out in kansas after passage of the kansas-nebraska act.
|
|
Entire securitization market
: The subprime securitization market collapsed in late 2007 and entire securitization market effectively closed in the second quarter of 2008. From then through June 30, 2009, the Motorcycle Trust was unable to sell notes backed by Harley-Davidson ..
|
|
New innovation in cmo structure
: As an assistant vice president at a regional bank, your boss has tasked you to find out about a new innovation in CMO structure called a Z Bond.
|
|
Write an essay on san fernando earthquake
: 1971 San Fernando earthquake. I need you to talk about this natural disaster and how they respond to it.
|
|
Identify and list all of the sustainability stakeholders
: Identify and list all of the sustainability stakeholders at Top Shelf. Does each group have equal weight throughout the program development process? When should each be brought into the discussion?
|
|
Characteristics of fixed income and common stock securities
: Create a matrix in which you describe characteristics of fixed income and common stock securities.
|