Financial Statment Analysis

BCO312 Financial Statement Analysis MIDTERM ASSIGNMENT

Task

Include all details of the task, including:

· individual

· be sure that similarity measure is below 20%!

· Word or pdf file submission is expected

· Please do not copy the text of the assignments!

Formalities:

· Wordcount: 700 words maximum, 500-700 words normal range

· Cover, Table of Contents, References and Appendix are excluded of the total wordcount.

· Font: Arial 12,5 pts.

· Text alignment: Justified.

· The in-text References and the Bibliography have to be in Harvard’s citation style.

Submission: 20th of June, 2021. Time: 23.59.

Weight: This task is a 40% of your total grade for this subject.

It assesses the following learning outcomes:

· Calculation of the ending and beginning equity

· Understanding of accounts receivable

· Uncollectible accounts estimation

· Understanding how different operations are reflected in financial statements

Question 1 (20 points):

At the beginning of a recent year, The Walt Disney Company’s liabilities equaled $32,940 million. During the year, assets increased by $6,401 million, and year-end assets equaled $81,241 million. Liabilities increased $164 million during the year. What is the beginning amounts for equity? What is the ending balance for equity?

Question 2 (30 points):

Attila, Inc. reported the following amounts in its 2018 and 2017 annual reports.

($ Millions)	Dec 31, 2018	Dec 31, 2017
From the income statement:
Net sales	$4076	$3,267
From the balance sheet
Accounts receivable (gross)	$371.8	$415.5
From the footnote on allowance for doubtful accounts:
Balance at beginning of period	$20.5	$25.6
Additions (reductions) charged to income	?	$16.1
Writeoffs or deductions	($14.5)	($21.2)
Balance at end of period	$23.0	$20.5

What is Atilla's net accounts receivable for the fiscal year ending Dec 31, 2017?

Question 3 (20 points):

Zoltan Company analyzes its accounts receivable at December 31, 2017, and arrives at the following totals for its two customer groups along with the percentages for each customer group that are estimated to be uncollectible.

Customer Group	Accounts Receivable	Estimated Uncollectible %
A	$230,000	2.0%
B	$139,000	11.0%

At the beginning of 2017, there was a balance of $14,490 in the Allowance for Uncollectible Accounts. During 2017, Zoltan Company wrote off $4,600 in writeoffs as uncollectible.

What is the ending balance of Allowance for Uncollectible Accounts at December 31, 2017?

Question 4 (30 points):

Apple describes its revenue recognition policy for gift cards as follows:

“The Company records deferred revenue when it receives payments in advance of the delivery of products or the performance of services. … The Company sells gift cards redeemable at its retail and online stores, and also sells gift cards redeemable on iTunes Store, App Store, Mac App Store, TV App Store and iBooks Store for the purchase of digital content and software. The Company records deferred revenue upon the sale of the card, which is relieved upon redemption of the card by the customer.”

In the following questions, assume that each gift card is worth $79 and that in 2017 Apple sold 800,000 gift cards for a total of $63.2 million.

Use the BSE below to record the following transaction:

Apple sells $63.2 million in gift cards in 2017.

Cash: ______

+ Non-cash Assets ________

· Contra Assets ________

=

Liabilities: __________

+ Shareholders Equity __________

Rubrics:

	Exceptional 90-100	Good 80-89	Fair 70-79	Marginal fail 60-69
Knowledge & Understanding (20%)	Student demonstrates excellent understanding of key concepts and uses vocabulary in an entirely appropriate manner.	Student demonstrates good understanding of the task and mentions some relevant concepts and demonstrates use of the relevant vocabulary.	Student understands the task and provides minimum theory and/or some use of vocabulary.	Student understands the task and attempts to answer the question but does not mention key concepts or uses minimum amount of relevant vocabulary.
Application (30%)	Student applies fully relevant knowledge from the topics delivered in class.	Student applies mostly relevant knowledge from the topics delivered in class.	Student applies some relevant knowledge from the topics delivered in class. Misunderstanding may be evident.	Student applies little relevant knowledge from the topics delivered in class. Misunderstands are evident.
Critical Thinking (30%)	Student critically assesses in excellent ways, drawing outstanding conclusions from relevant authors.	Student critically assesses in good ways, drawing conclusions from relevant authors and references.	Student provides some insights but stays on the surface of the topic. References may not be relevant.	Student makes little or none critical thinking insights, does not quote appropriate authors, and does not provide valid sources.
Communication (20%)	Student communicates their ideas extremely clearly and concisely, respecting word count, grammar and spellcheck	Student communicates their ideas clearly and concisely, respecting word count, grammar and spellcheck	Student communicates their ideas with some clarity and concision. It may be slightly over or under the wordcount limit. Some misspelling errors may be evident.	Student communicates their ideas in a somewhat unclear and unconcise way. Does not reach or does exceed wordcount excessively and misspelling errors are evident.