Jodi Oliver
Notes to Consolidated Financial Statements
ACCT-551
Professor John Zapapas
Oliver Knife and Tool is a Colorado-based manufacturer of knives, tools, and outdoor type accessories. All products are made in the USA and we feature a line of knives and tools built specifically for the female adventurist as well. Oliver brand knives and tools offer a wide variety of sports, work, and professional knives and tools that feature purpose driven designs and are built to withstand everyday use for a lifetime. We have utilized several innovative custom knife makers and designers that have helped in creating our unique knife, tool and accessory products. The result is some of the highest quality custom designs that are available to the consumer for daily use. All Oliver Knives and Tools are built incorporating the most advanced and latest proven production methods and highest quality of steels available, forged and hand assembled in the USA.
Fiscal Year
The company’s fiscal year ends on January 31st. All fiscal years presented will be for a 52 week period.
Principles of Consolidation
The company's consolidated financial statements include the accounts of the entire and any operating subsidiaries. Any inter-company accounts or transactions will be eliminated from the financial statement.
Use of Estimates
The company financial statements are prepared in accordance with the guidelines of United States GAAP and necessitate that management make estimates or assumptions that affect reported amounts on financial statements. Estimates given are founded on management's knowledge of present-day and upcoming actions the company might take. Estimates are used for assets, liabilities, sales and expenses, and related disclosures and ba...
... middle of paper ...
...arget company. It will also determine the price/terms of a transaction that Oliver Knife and Tool is prepared to offer and accept.
Note 10
Contingencies and Liabilities
Oliver Knife and Tool offers will replace a defective unit at no cost to the customer within one year of purchase. Oliver Knife and Tool will have an actual liability only if units are defective. Oliver Knife and Tool will have no liability and no warranty expense if there are no defected units.
Note 11
Changes in Accounting Principles or Estimates When the company receives new information that shows a previous estimate is incorrect the company will incorporate the new estimate to determine the financial statement from that point on. This will affect the balance sheet and income statement for current and future financials. A disclosure note will explain the change in the estimate on net income.
The effect of correction of the error and change in accounting method on retained earnings and significant asset and liability accounts is as follows:
An important part of financial planning for corporations is the annual report. Publically held companies are required to submit an annual report to the SEC and private companies, even though not required, can use an annual report to gauge the performance of the company for the past year and use the report to plan for the future. The financial statements that make up an annual report are the income statement, the balance sheet, and the statement of cash flows. (Melicher, 2014) Once all of the financial information has been compiled and the three statements that make up the annual report have been completed a corporation can then start to analyze the data. There are several different categories of financial ratios
Accounting policies are essential for adequately understanding the information provided in financial statements. An entity as required by GAAP, should present as an integral part of the financial statement a statement identifying the accounting policies adopted and followed by the reporting entity (Kieso, Weygandt & Warfiled, 2015, p.1391). Accounting policies are the specific accounting methods an organization presently uses and considers most appropriate to present its financial statements fairly. The disclosing of accounting policies must incorporate important conclusions as to the relevance of principles concerning the recognition of revenue and allocation of asset costs to current and future periods (FASB). Identifying accounting policies
This will be the balance sheet, income statements, and cash flow statements. What we want to determine is how many years does each complete. Let us look at the balance sheet. It represented February 2014-January 2015. The Income statement was February 2013-Janurary 2015, and the cash flow statement was February 2013-Janurary 2015.
We will follow proper accounting and disclosure practices. All record keeping and financial statements will be prepared according to GAAP standards and reviewed by an independent
Marshall, M.H., McManus, W.W., Viele, V.F. (2003). Accounting: What the Numbers Mean. 6th ed. New York: McGraw-Hill Companies.
Financial and Managerial accounting are used for making sound financial decisions about an organization. They provide information of past quantitative financial activities and are useful in making future economic decisions. (Albrecht, Stice, Stice, & Skousen, 2002) The same financial data is used to derive reports for each accounting process yet they differ in some ways. Financial accounting primarily provides external reports for external users such as stock holders, creditors, regulating authority and others. (Garrison, Noreen, & Brewer, 2010) On the other hand Managerial accounting is concern with providing information that deals with the internal viability of the organization and is tailored to meet the needs of an individual organization. (Albrecht, Stice, Stice, & Skousen, 2002)
The accuracy of budget projections was also monitored during the year and formally revised on three occasions. The first of these occasions occurs in the March meeting of the Executive Committee. Each Executive Committee member is asked to update the Committee on his most recent estimates of sales and profits for each operating company for the current year. Herb Stolzer is dependent on Roy Black to provide this information for Stolzer’s review prior to the March
A consolidated financial statement can be defined as the financial statements of a parent and its subsidiaries combined to form a single economic entity (AASB 10, 2011). The entity, which acquires the other entity, is known as the parent and the entity, which has been acquired, is known as the subsidiary. Consolidation financial reports arise when one entity purchases another entity, to then form a group.
According to the conceptual framework, the potential users of financial statements are investors, creditors, suppliers, employees, customers, governments and agencies, and the general public (Financial Accounting Standards Board, 2006). The primary users are investors, creditors, and those who advise them. It goes on to define the criteria that make up each potential user, as well as, the limitations of financial reporting. The FASB explicitly states that financial reporting is “but one source of information needed by those who make investment, credit, and similar resource allocation decisions. Users also need to consider pertinent information from other sources, and be aware of the characteristics and limitations of the information in them” (Financial Accounting Standards Board, 2006). With this in mind, it is still particularly difficult to determine whom the financials should be catered towards and what level of prudence is necessary for quality judgment.
When you submit a valid claim under this warranty, apple have three option .The first you can use of new or previously used parts, a new apple product performance and reliability of service. Second you can replace a product, at least functionally equivalent to the Apple products and new or parts previously used is equivalent to the performance and reliability of the new form replace Apple products. Last, you can refund your purchase price in exchange for the return of your Apple
I agree with Kevin’s statement that financial statements provide only a partial look at the picture when valuing a company. While providing the financial data such as sales, expenses, gross profit, total assets and liabilities, and net worth it leaves out the internal influences that most influence the bottom line.
Financial statements are those statements which provide information about profitability and financial position of a business. It includes two statements, i.e., profit & loss a/c or income statement and bal...
As per paragraph 42 AASB 108, an entity shall correct material prior period errors retrospectively by restating the comparative amounts for the prior period(s) in which the error occurred, or if the error occurred before the earliest prior period presented, restating the opening balances of assets, liabilities and equity for the earliest prior period presented. In other words, the effect is to restate the current year’s financial statements as if the error had never occurred. The discovery of any prior period errors are excluded from current period’s profit or loss, but will be shown or hidden in retained earnings. It could be argued that this gives incentives to managers for using prior period corrections as a form of earnings management because it allows them to manipulate current earnings.
Marshall, D., McManus, W., & Viele, D. (2004). Accounting: What the numbers mean. [University of Phoenix Custom Edition e-text]. New York, NY: McGraw-Hill Companies.