What kind of accounting issues do you expect at ULTA (across all 3 main statements), given its review of its stores in the covid era?
How would you determine the optimal amount of debt and the appropriate amount of advisory service fee? What are factors other than the debt load that could lead a firm to file Chapter 11?
So Staples’ results were impacted by goodwill impairment and restructuring charges. What are the economic implications of these accounting charges? What are the recognition criteria for these accounting charges?
Cisco has announced a restructuring charge of up to $700 million to cover layoffs of employees. What entry will Cisco make to record the charges? Will the loss be reported on the income statement “above the line” or “below the line”?
Do you think that P&G’s CEO should have given specifics re: $10 billion in proposed cost savings? What are the benefits of being specific? What are the costs? What are some ratios that might be affected by costs savings? How might the firm’s share price be affected?
Intel plans to layoff several thousand employees. What is the name of the expense charged against income? How is this charge measured? Is there a stock price reaction? Why or why not?
HP is splitting into two publicly traded companies. What is the journal entry for the restructuring charge? HP expects $1 billion in savings from the restructuring. Do you think the accounting standards should allow recognition of the savings at the same time firms are required to recognize the restructuring charge? Why or why not?
Do you agree that the “relevance of accounting information is decreasing”? Are the new financial metrics to measure firm performance an indicator of market participants’ impatience with the FASB addressing lack of relevance? Will the FASB lose its own relevance?
Zynga announced a restructuring plan for the current quarter and filed an 8K with the SEC. Was Zynga required to file the 8K? What is the purpose of the restructuring? What is the journal entry to record the restructuring, if any? Will Zynga make any journal entry to accrue cost savings under the restructuring plan?
Whirlpool closed a plant in the U.S. in 8 months, but it takes years to close a plant in Italy, under its restructuring plan. How should the restructuring liability be classified: current or noncurrent?
HP’s “marriage” to EDS did not work out as planned. Why not? The firm also increased its estimate of a restructuring charge? Why? What is the difference between an impairment and a restructuring?
Where is Nokia in its life cycle? What do you expect to see in this phase with respect to operating cash flows? Investing cash flows? Financing cash flows? Will you buy a Nokia phone in the next 6 months? Will you sell to Nokia over the next 6 months?
So, Nokia is cutting 10,000 jobs. What will be some of the effects on Nokia’s current and future financial statements? Per the article, Microsoft is closely tied to Nokia. Would Microsoft have the same effects on its financial statements?
