Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN: 9781285190907
Author: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher: Cengage Learning
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Chapter 9, Problem 14PC
Discuss when each of the following types of businesses is likely to recognize revenues and expenses.
- a. A bank lends money for home mortgages.
- b. A travel agency books hotels, transportation, and similar services for customers and earns a commission from the providers of these services.
- c. A major league baseball team sells season tickets before the season begins and signs its players to multiyear contracts. These contracts typically defer the payment of a significant portion of the compensation provided by the contract until the player retires.
- d. A producer of fine whiskey ages the whiskey 12 years before sale.
- e. A timber-growing firm contracts to sell all timber in a particular tract when it reaches 20 years of age. Each year it harvests another tract. The price per board foot of timber equals the market price when the customer signs the purchase contract plus 10% for each year until harvest.
- f. An airline provides transportation services to customers. Each flight grants frequent-flier miles to customers. Customers earn a free flight when they accumulate sufficient frequent-flier miles.
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Net sales
Windswept, Incorporated
2024 Income Statement
Cost of goods sold
Depreciation
($ in millions)
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Interest paid
Taxable income
Taxes
Net income
$ 14,150
8,150
515
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Windswept, Incorporated
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($ in millions)
2023
2024
2023
2024
Cash
Accounts received
$ 300
$ 330
Accounts payable
$ 1,980
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1,190
1,090
Long-term debt
1,110
1,430
Inventory
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1,795
Common stock
3,440
3,080
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$ 3,215
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Net fixed assets
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Total assets
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$ 7,220
$ 7,405
What is the fixed asset turnover for 2024?
Chapter 9 Solutions
Financial Reporting, Financial Statement Analysis and Valuation
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