Chapter 10, Problem 10.13C

To determine

(A)

Introduction:

The measurement and recognition of the costs for trade and consumer promotion programs involves the use of judgment related to performance and redemption estimates.

To choose:

What are the principal components includes in the firm receivable?

Explanation of Solution

The organization offers different deals motivator projects to clients and buyers, for example, include value limits, in-store show impetuses, agreeable promoting programs, new item presentation charges, and coupons. The blend between advancement programs, which are named decreases in income, and promoting or other showcasing exercises, which are delegated advertising and selling costs, varies between periods dependent on the organization's general advertising plans, and such vacillations affect incomes.

To determine

(B)

Introduction:

Stock valuation is an essential idea for the assembling organization in light of the fact that by the computation this valuation demonstrating the closure shutting stocks an incentive at last asset report. These strategies help for the computation end stock esteem.

To choose:

What inventory method being used for the financial reporting purpose.

Explanation of Solution

The method being used is disclosed. If different methods are being for different categories of inventory the method used for each category is disclosed. When LIFO is used comparison of the cumulative difference in the balance sheet inventory under LIFO with what it would have been under FIFO usually is disclosed. All of Campbell's inventories are valued at lower of average cost or market.

To determine

(C)

Introduction:

There are two type of tax rate one is statuary tax rate and another one is effective tax rate because tax rate applied on the income is statuary rate but due to some reasons the difference may be arise between the effective rate and statuary rate. This must be reconciling by find the issue in these two rates.

To choose:

Does the firm report a reconciliation of statuary income tax rate with the effective tax rate?

Answer to Problem 10.13C

The following is a reconciliation of the effective income tax rate on continuing operations to the U.S. federal statutory income tax rate:

	2014	2013	2012
Federal statutory income tax rate State income taxes (net of federal tax benefit) Tax effect of international items Settlement of tax contingencies Federal manufacturing deduction other Effective income tax	35.0% 2.0 (1.0) - (2.3) (1.4) 32.3%	35.0% 1.1 (2.6) (0.1) (2.7) (1.9) 28.8%	35.0% 2.0 (3.8) (0.1) (1.9) (0.2) 31.0%

Explanation of Solution

The provision for income taxes on earnings from continuing operations consists of the following:

	2014	2013	2012
Income taxes: Currently payable: Federal State Non-U.S. Deferred: Federal State Non-U.S. Earningsfrom continuing operations before income taxes: United States Non-U.S.	$ 252 30 42 324 32 2 (11) 23 $ 347 $ 995 78 $ 1,073	$ 268 24 47 339 (58) (6) (64) $ 275 $ 815 140 $ 955	$ 221 29 43 293 31 2 (1) 32 $ 325 $ 918 131 $ 1,049

To determine

(D)

Introduction:

Any significant subsequent events occurred since the balance sheet date. Some most item is very important for the company, but company cannot show these items in the current year balance sheet because these may be occur in future but company must show these effect in the current year balance sheet.

To choose:

What effect that these items will have on future financial statement?

Answer to Problem 10.13C

Company may be positive or negative effect on the current year financial statement.

Explanation of Solution

If company sold goods on 15 December to a customer and he will pay the amount in future. But at the end company release that customer will not they pay the amount and he may be bankrupt then company must adjusted the amount in the current year as a bad debt. Company may be positive or negative effect on the current year financial statement.

To determine

(E)

Introduction:

Cash and cash equivalents are the balance of all types of current investment, cash balance, bank balance. These all show in the balance sheet in the current assets heads. This balance shows the one point balance, what the balance is on the last date of financial report.

To choose:

What are the principal components included in the firm's cash?

Explanation of Solution

This component shows the cash and cash equivalents must be disclosed. The reconciliation present between the what balance shows in the balance sheet and how to receive or paid the amount during the year.

Prepare cash flow statement and reconciliation the cash with the opening cash balance and end cash balance.

To determine

(F)

Introduction:

Depreciation is that value which is assets used by the business in current yea, this is business expense and this expense reduced the current year profit. Depreciation show in the current year profit and loss and also reduced form the related particular assets form the balance sheet.

To choose:

Which method is follow by the company?

Answer to Problem 10.13C

Company uses the Straight line method on the long term assets.

Explanation of Solution

Form the annual report of Campbell soup company, the amount of Depreciation and amortization (this is extract file form the annual report)

Campbell Soup Company

Consolidated statements of Cash Flows

(Millions)

Particular	2014	2013	2012
Cash flow from operating Depreciation and amortization	305	407	262

To determine

(G)

Introduction:

Stock option plan means company issued share to the employees of the company at the lower of the market value per share. Because if company issued the share to the employee then employee will not leave the job or focus on the job or target.

To choose:

How many companies have the stock options plan outstanding?

Explanation of Solution

Form the annual report of the company, company have stock option plan the number of share outstanding is 5 share and the value of these share also $174.

To determine

(H)

Introduction:

Management assesses the probability of loss for all legal proceedings and claims and has recognized liabilities for such contingencies, as appropriate. Although the results of these matters cannot be predicted with certainty, in management's opinion, the final outcome of legal proceedings and claims will not have a material adverse effect on the consolidated results of operations or financial condition of the company.

To choose:

Does company have any significant contingencies or commitments that have not been reported as liabilities on the balance sheet?

Answer to Problem 10.13C

The company has provided certain standard indemnifications in connection with divestitures, contracts and other transactions. Certain indemnifications have finite expiration dates. Liabilities recognized based on known exposures related to such matters were not material at August 3, 2014, or July 28, 2013.

Explanation of Solution

(This data taken form the annual report of 2014)

The company has certain operating lease commitments, primarily related to warehouse and office facilities, and certain equipment. Rent expense under operating lease commitments was $50 in 2014, $54 in 2013 and $48 in 2012. These amounts included $2 in 2014, $8 in 2013 and $9 in 2012 related to discontinued operations. Future minimum annual rental payments under these operating leases as of August 3, 2014 are as follows:

2015	2016	2017	2018	2019	Thereafter
$38	$32	$26	$22	$18	$58

(This data taken form the annual report)

The organization ensures roughly 2,000 bank credits made to Pepperidge Farm free deals merchants by budgetary foundations for the buy of dispersion courses. The greatest potential measure of future installments under 71 existing ensures the organization could be required to make is $179. The organization's certifications are in a roundabout way verified by the dispersion courses. The organization does not trust it is plausible that it will be required to make ensure installments because of defaults on the bank advances ensured. The sums perceived as of August 3, 2014, and July 28, 2013, were not material.