Prepaid expenses vs unearned revenue

Assignment Help Accounting Basics
Reference no: EM13759111

Prepaid Expenses vs. Unearned Revenue

From this week's reading, you were introduced to the concept of unearned revenue and prepaid expenses. Imagine that you are CFO of a company that manufacturers picture frames. Your company wants to become more vertically integrated, meaning it no longer wants to purchase the products that go into the frame, but rather manufacture them. To do this, your company has decided to acquire a glass manufacturing company. There are two glass manufacturers that your company is deciding between: Glass R' US and Glass Team. In reviewing the balance sheet of each company, you noticed the following:

a. Glass R' US has a large amount of Unearned Revenue and no Prepaid Expenses.

b. Glass Team has a large amount of Prepaid Expenses and no Unearned Revenue

In your discussion post, explain what unearned revenue and prepaid expenses represent. Then, basing your decision solely on the amount of unearned revenue and prepaid expenses each company has, tell us which company you would acquire and why? (In answering "why", be sure to include why you believe that company's position is superior. For example, "I believe having a large amount of prepaid expenses is a better position because ....")

Reference no: EM13759111

Questions Cloud

Effective transportation design and an ineffective one : Distinguish between an effective transportation design and an ineffective one and describe the various modes of transportation and their use in supply chains
In what ways is the zara model counterintuitive : In what ways is the Zara model counterintuitive? In what ways has Zara's model made the firm a better performer than Gap and other competitors
How a literary analysis is different than other essays : Discuss the process you used to write the literary analysis for the Week Three rough draft assignment. Describe how a literary analysis is different than other essays you have written.
Important in your firms supply chain : Which type of transportation is most important in your firm's supply chain? Could your firm use a different mix of transportation modes to improve its efficiency?
Prepaid expenses vs unearned revenue : From this week's reading, you were introduced to the concept of unearned revenue and prepaid expenses. Imagine that you are CFO of a company that manufacturers picture frames.
What literature represents about the human experience : Analyzing those more complicated elements can help you discover what literature represents about the human experience and condition.
Benefits of cost accounting : You are a consultant for Blue Sky Consulting in the small town of Centervale. After 30 years of saving for retirement you discuss with your boss the possibility of early retirement.
Java shape program console : Program is adequately documented. It's comments identifies its name, purpose, author and date.Throughout the code, comments and/or relevant component names should attempt to make theprogram understandable.
Write paper on the threats and weaknesses for a company : Write paper on the threats and weaknesses for a company

Reviews

Write a Review

Accounting Basics Questions & Answers

  On july 1 2013 apache company sold a parcel of undeveloped

on july 1 2013 apache company sold a parcel of undeveloped land to a construction company for 5000000. the book value

  For kozy company actual sales are 1311500 and break-even

for kozy company actual sales are 1311500 and break-even sales are 890500. compute the following a the margin of safety

  On january 1 a company issues bonds dated january 1 with a

on january 1 a company issues bonds dated january 1 with a par value of 400000. the bonds mature in 5 years. the

  Queens co is considering starting a multimedia advertising

the queens company had revenues of 930000 last year with total variable costs of 399900 and fixed costs of

  Investing in a mnc

Research a large multinational company in which you might like to invest. Then estimate the most significant risk factors associated with investing in company you selected when compared with investing in the domestic company.

  If a transfer price of 105 per unit is established and

materials used by the industrial divison of crow manufacturing are currently purchased from outside suppliers at a cost

  A friend has 4800 that has been saved from her part-time

a friend has 4800 that has been saved from her part-time job. she will need her money plus any interest earned on it in

  Research and developments costs

Research and Developments Costs

  Ignoring the cash inflows to the nearest whole dollar how

ignoring the cash inflows to the nearest whole dollar how large would the salvage value of the equipment have to be to

  Darling company which applies overhead to production on the

darling company which applies overhead to production on the basis of machine hours reported the following data for the

  Compute the net amount of deferred income taxes to be

presented below are two independent situations related to future taxable and deductible amounts resulting from

  Securities business

How may an online securities company (ETrade, Schwab, etc.) differentiate themselves in market? What are the opportunities for future growth? Please give a detailed response.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd