When the amount goes over the fair value of the lease the amount should be documented as an asset. c. What expenses related to this lease will Lani incur during the first year of the lease, and how will they be determined? Lani will obtain interest which will equal the amount used benefits the lease which is multiplied by the liability. She will receive fees associated with the depreciation of the cost of capital towards the cost of assets. d. How should Lani report the lease transaction on its December 31, 2006, balance sheet?
The two are used in a way that balances these costs and revenues. To obtain the contribution margin, L.L. Bean computes: item retail price if demanded – item cost To obtain the
This information can be useful in determining the value of a house an owner intends to sell. Another important feature that
Perform a regression on this data with sales price as the Y variable, and answer the following questions. (a) Find the equation that relates sales price (Y) to square footage (X1) and age (X2). Y = 9735 + 40.708 X1 - 346.174 X2 (b) Estimate the sales price of a home with square footage 2,000 and age 20. Price with X1 = 2000 and X2 = 20 Y= 84,229.12 (c) Find the coefficient of determination, and
Loyalty points program PDL operates a loyalty points program, which will impact on the measurement of sales revenue, important for analysts. Currently, a sale transaction with point value attached is recognized as a sale entirely in the current period. An expense and liability for the expected cost – not sales value – of goods to be redeemed in the future is recognized in the same time period as the sale. This policy maximizes the sales value recorded with the initial transaction. It does not reflect the substance of the transaction, though, which is that PDL has rendered multiple deliverables in sale: both the initial sale, and the subsequent sale based on points value are being sold.
The paper intends to close on existing research gap by providing a new framework to the investigating service quality in the real estate industry (Tuzovic, 2009). Studies of service quality have been conducted in a wide variety of industries; however, relatively few studies have addressed the service quality in the real estate industry (Tuzovic, 2009). Real estate services that account for about 13% of the GDP in the USA represent intangible, high-contract services in which buyer and renter have to rely primarily on experience and credence qualities (Tuzovic, 2009). The buyer and renters have to travel far to the real estate firm’s office and to the houses the customers want to view. Perspective buyers and renters are forced to rely on search qualities before they meet with a realtor (Tuzovic, 2009).
REAL OPTIONS AND THEIR INCORPORATION WITHIN CAPITAL BUDGETING A real option is a form of derivative, similar to a forward contract, but with a couple of important differences. A real option infers the right, but not an obligation, to buy an underlying real asset. The holder of a real option will compare the market value of the asset in question, along with the agreed exchange value on the option and can then decide whether to exercise that option or tear it up. This flexibility can come at considerable cost, which we will examine in the next section. The process of capital budgeting focuses on the incremental increase in cash flows associated with an investment decision or investment project.
The information “Bookings” convey is that: the company record sale of virtual goods as deferred revenue and then recognize the revenue over the estimated average life the purchased virtual goods or as the virtual goods are consumed. The way that Zynaga recognized revenue is based on the estimated life of virtual goods. This is not the same information available in the GAAP-based financial statements. Under GAAP, companies use accrual basis which they recognize revenue when they perform the service. 2) Do you think this is a useful measure?
While the traditional accounting methods are good to measure past performance and financial stature, it does not allow for managers to see the impact or value that marketing has on the bottom line. For a manager to evaluate the impact of marketing they will need view the current marketing expenditures, sales, and profits to make a conscious decision on what methods are working. While I think placing marketing as an investment is a good concept, determining the value is too biased without a common measurement between all companies in a similar industry. Without understanding the current value of marketing, the marketing budget will be one of the first items cut when the business is in a downturn. Technology in all industries has increased dramatically over the past 10 years so being able to understand the current value of marketing methods should not be as strenuous as it has been in the past.
Finally, you would add up the future values of all the individual cash flows to determine the future value of the cash flow stream. 2. Explain how to calculate the present value of a stream of cash flows. To calculate the present value of a stream of cash flows, you should first draw a time line so that you can see that each cash flow is placed in its correct time period. Then you simply calculate the present value of each cash flow for its time period, and finally you add up all the present values.