File Name: molson coors brewing company and subsidiaries consolidated statement 2013 december 29 .zip
Table of Contents. Washington, D. FORM K. For the fiscal year ended December 31,
Victoria Dickinson Reader: Dr. Mark Wilder. Each topic was thoroughly researched as assigned. Included in each case is an analysis of each company and its financial stability along with various mathematical calculations to better understand each situation. As the cases progress, the accounting topics become more advanced. Topics range from generic financial accounting to more specialized areas such as pension plans and benefits.
By: Rachel A. Both companies had identical transactions throughout the year, but preformed very different adjusting entries at the end of the period.
After the adjusting entries were performed, one can see that the best company to invest in is Eads Heating. Eads looks to the future and provides room for growth of the company.
Investors and creditors should have faith that the future benefits of Eads s adjusting entries will outweigh the current expenses. The detailed transactions and financial statements of the year 20X1 prove that in the end, Eads Heating seems to be a better investment decision instead of Glenwood Heating.
In order to arrive at this conclusion, the various transactions and adjustment entries from both companies were examined see Appendix A Case One and Appendix B Case Two. From that information, financial statements were assembled. The income statement for Eads Heating, Inc. Figure 1: Eads Heaters, Inc. Glenwood seemed to be more optimistic in hopes that only one percent of accounts receivable will be uncollectible. Eads, however, estimated that 4.
As a result, the higher estimation percentage negatively impacted Eads s net income. Eads also depreciated its delivery equipment using the double-declining balance method, thus causing a much higher depreciation expense at the end of the year. Both companies use the same equipment, so while Eads has chosen to depreciate more of the equipment s value earlier, Glenwood will have to depreciate this equipment later.
As a result, Glenwood s investors could see a fall in net income in the years to come due to a larger depreciation expense. Eads s depreciation methods will be more beneficial for the company and its investors in the future. After Net Income was devised, the retained earnings statements for both companies were assembled.
Eads Heating, Inc. However, the dividends to investors were equal. Assuming management has the stockholders best interests in mind, it can be assumed that in the future when Eads is able to boost its net income, it will also increase its dividends to stockholders. Figure 3: Eads Heating, Inc. Eads s balance sheet see Figure 5 on next page shows that Eads has a higher value of assets than Glenwood Glenwood s balance sheet shown in Figure 6.
However, with this comes a higher level of liabilities. The main difference in the two companies is in the way Eads handled their lease equipment contract. Eads looked to the future and developed a contract for the next eight years while Glenwood only extended the contract through year two.
As a result, the lease equipment is considered an asset on Eads s balance sheet, and the contract is considered a liability because Eads has to make payments every year. This also contributes to the increased depreciation expense seen on the income statement because Eads has to depreciate this asset like any other longterm asset.
A statement of cash flows shows a summary of the cash inflows and outflows during a period. As seen in Figure 7, the operating activities portion of the cash flows statement was better for Eads than the operating activities for Glenwood Figure 8.
Both companies showed negative operating cash flows, but Eads s large depreciation expense among other things significantly increased this portion of the statement of cash flows thus making the total cash flows of the company higher. This is important because the company s cash flows show potential or current investors how much cash the company actually generated or lost during this period. Glenwood s total is lower than Eads s total meaning that Eads lost less cash throughout the year.
The large negative numbers seen on both companies statements of cash flows could be some cause for concern, but since the companies just began this year, they were required to make multiple large purchases like those found under investing activities in order to begin business operations.
In the end, Eads s cash flows show again that Eads is the best choice to invest in or loan money to given the choice of the two. The full list of ratios and their results can be seen in Appendix C Case One. The first category of ratios is liquidity ratios. Liquidity ratios measure the company s ability to pay off debts that mature within the current year. The current ratio reveals the rate at which current assets are rising with respect to current liabilities.
Both of these companies have a relatively similar current ratio, but Glenwood appears to be slightly more liquid from this figure. However, upon further investigation, one can find that Eads actually appears to be more liquid overall. Eads has a higher acid-test ratio meaning that it is more liquid than Glenwood if inventory is not taken into account. Inventory is considered the least liquid of all the current assets because it can be difficult to sell if funds are needed quickly.
The other current assets can be used almost immediately if needed and are much less likely to result in losses so the acid-test ratio is often seen as a better measure of liquidity. The accounts receivable turnover ratio and the days to collect receivables ratios reveal that the companies are very similar in their ability to collect their receivables. The inventory turnover ratio and days to sell inventory ratio, on the other hand, are much better for Eads than Glenwood.
This means that Eads s inventory can be sold easier than Glenwood s inventory. Similarly, the operating cycle is shorter for Eads meaning the average number of days between a customer s purchase and the collection of cash for that sale is shorter than Glenwood.
These ratios prove that Eads is the most liquid company between the two. As a result, loaning money to this company especially in the short term would be a safer decision because this company shows the ability to pay off its debt easier than Glenwood using just its current assets.
Profitability ratios show how profitable the firm is operating and utilizing its assets. These ratios include gross profit margin, profit margin, return on assets, return on owners equity, and earnings per share.
At first glance, these ratios give the impression that Glenwood would make the better investment. However, while ratios do help us evaluate financial statements, they can be misleading if one does not look past the actual number. For example, in the analysis of the income statement, the majority of the difference between Glenwood and Eads came from estimation accounts such as depreciation expense and bad debt expense.
A company could lowball an estimation in order to increase net income to show larger profitability ratios. Eads depreciated a large amount of its delivery equipment in the first year of business so the company s expenses will be lower in the future than Glenwood s.
The last category of financial ratios calculated was the long-term solvency ratios. These ratios show the companies abilities to cover long term obligations. The debt ratio is slightly higher for Eads meaning that Eads has a higher percentage of assets provided by debt. This also means that they have a higher risk. However, this is because Eads chose to renew its contract for the lease equipment for eight years, thus increasing its liabilities leading to a higher debt ratio.
However, this will ensure that they have the lease equipment for the next eight years whereas Glenwood will have to renew their lease again at the end The last ratio examined was the times interest earned ratio. This ratio investigates the company s ability to pay its interest expenses from its earnings. Glenwood has a higher ratio, but this can be explained by the fact that Eads has more interest to pay due to its lease agreement terms. As a result, Eads has more long term debt, but the company is using this debt in order to finance things like equipment that will provide future benefits.
Transaction Number Cash Accounts Receivable Allowance for Bad Debts Inventory Land Building Accumulated Depreciation, Building 1 , , 3 70, , 4 80, 5 , , , , 8 9 41, 10 34, 11 23, 12 totals: 47, 99, , 70, , - Adjusting Entry Number 1 4, 2 , 3 10, 4a 4b 4c 16, 5 23, adjusted totals: 7, 99, 4, 51, 70, , 10, Figure Financial Transactions and Adjustments for Eads Heating, Inc.
Transaction Number Equipment Accumulated Depreciation, Equipment Leased Equipment Accumulated Depreciation, leased Equipment Accounts Payable , , , totals: 80, , Adjusting Entry Number , 4a 92, 4b 11, 4c 5 adjusted totals: 80, 20, 92, 11, 26, Transaction Number Cash Accounts Receivable Allowance for Bad Debts Inventory Land Building Accumulated Depreciation, Building 1 , , 3 70, , 4 80, 5 , , , , 8 9 41, 10 34, 11 23, 12 totals: 47, 99, , 70, , - Adjusting Entry Number , 3 10, 4a Jan 5 4b Dec 31 16, 5 30, adjusted totals: , , 70, , 10, Figure Financial Transactions and Adjustments for Glenwood Heating, Inc.
The figures in this statement were gathered using estimation techniques based off the previous years. The yearly sales have grown pretty steadily over the past three years. As a result, we decided to increase the sales by 7. As a result, we took the projected sales and multiplied them by thirty percent to arrive at the final excise tax amount. These two calculations allowed us to arrive at the forecasted net sales. Cost of goods sold was found in a similar way.
This is because more beer sales call for a greater total cost to make and ship the beer. Over time, the cost of goods sold has been about forty percent of sales. This year we chose to apply a rate of 43 percent of sales to cost of goods sold in order to account for things like inflation and other miscellaneous additional expenses.
This allowed us to arrive at the gross profit. From there, other operating expenses were examined. The marketing, general and administrative expenses have also increased over time. We applied a 4 percent growth rate in these expenses for the upcoming year. The special items seen in the income statement were a little harder to predict. Upon examining the special items summary statement, we found that many of the numbers for the upcoming year could not be estimated in advance due to the amount of uncertainty in the future.
For example, the footnote one in Appendix A Case Two discusses restructuring costs. These are expenses associated with the restructuring programs of the company s many locations. These The company provided no information about their intent to preform future restructuring programs. As a result, this item was left out of the calculation for special items because it is completely independent of the past years, and we have found no good way to estimate it for the years to come.
The only consistent special item appearing in the special items table seems to be the release of non-income-related tax reserve in Europe. These seemed to be fairly frequent which led to our decision to include these expenses in the overall forecasted income. The amount seems to be increasing over time causing us to value s release at 5.
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Victoria Dickinson Reader: Dr. Mark Wilder. Each topic was thoroughly researched as assigned. Included in each case is an analysis of each company and its financial stability along with various mathematical calculations to better understand each situation. As the cases progress, the accounting topics become more advanced. Topics range from generic financial accounting to more specialized areas such as pension plans and benefits. By: Rachel A.
И вот Халохот уже за спиной жертвы. Как танцор, повторяющий отточенные движения, он взял чуть вправо, положил руку на плечо человеку в пиджаке цвета хаки, прицелился и… выстрелил. Раздались два приглушенных хлопка. Беккер вначале как бы застыл, потом начал медленно оседать. Быстрым движением Халохот подтащил его к скамье, стараясь успеть, прежде чем на спине проступят кровавые пятна.
Может быть, он сражается с вирусом. Джабба захохотал.
MOLSON COORS BREWING COMPANY AND SUBSIDIARIES In , Coors Light had an approximate 13% market share and was the top Our consolidated joint venture in India gives us a 51% share and operational refers to the 52 weeks ended on December 29, , and refers to theReply
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