财务报表分析第十版课后答案第四章Financialstatementanalysis(tenthed

Chapter04-AnalyzingInvestingActivities4-1Chapter4AnalyzingInvestingActivitiesREVIEWAssetsarethedrivingforcesofprofitabilityforacompany.Assetsproducerevenuesthatcompensateworkers,repaylenders,rewardowners,andfundgrowth.Currentassetsareresourcesorclaimstoresourcesreadilyconvertibletocash.Majorcurrentassetsincludecashandcashequivalents,marketablesecurities,receivables,derivativefinancialinstruments,inventories,andprepaidexpenses.Ouranalysisofcurrentassetsprovidesusinsightsintoacompany'sliquidity.Liquidityisthelengthoftimeuntilassetsareconvertedtocash.Itisanindicatorofacompany'sabilitytomeetfinancialobligations.Thelessliquidacompany,thelowerisitsfinancialflexibilitytopursuepromisinginvestmentopportunitiesandthegreateritsriskoffailure.Noncurrentassetsareresourcesorclaimstoresourcesexpectedtobenefitmorethanthecurrentperiod.Majornoncurrentassetsincludeproperty,plant,equipment,intangibles,investments,anddeferredcharges.Ouranalysisofnoncurrentassetsprovidesusinsightsintoacompany'ssolvencyandoperationalcapacity.Solvencyreferstotheabilityofacompanytomeetsitslong-term(andcurrent)obligations.Operationalcapacityistheabilityofacompanytogeneratefutureprofits.Thischaptershowshowweusefinancialstatementstobetterassessliquidity,solvency,andoperationalcapacityusingassetvalues,andtocriticallyevaluateacompany'sfinancialperformanceandprospects.Theaccountingpracticesunderlyingthemeasurementandreportingofcurrentandnoncurrentassetsaredescribed.Wediscusstheaccountingfortheseassetsanditsimplicationsforanalysisoffinancialstatements.Specialattentionisgiventovariousanalyticaladjustmentshelpingusbetterunderstandcurrentandfutureprospects.Chapter04-AnalyzingInvestingActivities4-2OUTLINESection1:CurrentAssetsCashandCashEquivalentsAnalyzingCashandCashEquivalentsReceivablesValuationofReceivablesAnalyzingReceivablesPrepaidExpensesInventoriesInventoryAccountingandValuationAnalyzingInventoriesSection2:NoncurrentAssetsIntroductiontoLong-LivedAssetsAccountingforLong-LivedAssetsCapitalizingversusExpensing:FinancialStatementandRatioEffectsPlantAssetsandNaturalResourcesValuingPlantAssetsandNaturalResourcesDepreciationandDepletionIntangibleAssetsAccountingforIntangiblesAnalyzingIntangiblesGoodwillUnrecordedIntangiblesandContingenciesChapter04-AnalyzingInvestingActivities4-3ANALYSISOBJECTIVESDefinecurrentassetsandtheirrelevanceforanalysis.Explaincashmanagementanditsimplicationsforanalysis.Analyzereceivables,allowancesforbaddebts,andsecuritization.Interprettheeffectsofalternativeinventorymethodsundervaryingbusinessconditions.Explaintheconceptoflong-livedassetsanditsimplicationsforanalysis.Interpretvaluationandcostallocationofplantassetsandnaturalresources.Describeandanalyzeintangibleassetsandtheirdisclosures.Analyzefinancialstatementsforunrecordedandcontingentassets.Chapter04-AnalyzingInvestingActivities4-4QUESTIONS1.a.No.Whenanalyzingcash,themostliquidofcurrentassets,theanalystisinterestedintheavailabilityofcashinmeetingthecompany'sobligations.Arestrictionundercompensatingbalancearrangementsdoes,atworst,removethesecashbalancesfromimmediateavailabilityasmeansofpayment.Indeed,useofsuchbalancescanhaverepercussionsforthecompanythatcanaffectitsfutureaccesstobankcredit.b.Theanalystshouldexcludecashrestrictedundercompensatingbalanceagreementsfromcurrentassets.SECAccountingSeriesRelease148requiresthatacompanythathasborrowedmoneyfromabanksegregateonitsbalancesheetanycashsubjecttowithdrawalorusagerestrictionsundercompensatingbalanceagreementswiththelendingbank.Theserequirementsmay,asisoftenthecaseinsuchsituations,movecompaniesandtheirbankertoaltertheformoftheircontractualagreementswhileretainingtheirsubstance.Theanalystmustbeeveralerttosuchattemptstodistortanalysismeasurementsbypresentationswhoseformisnotatruereflectionoftheirsubstance.Onemeasureofacompany’svulnerabilityinthisareaistheratioofrestrictedcashtototalcash.2.a.Theoperatingcycleconceptisimportantintheclassificationofassetsandliabilitiesaseithercurrentornoncurrent.Theoperatingcycleencompassestheperiodoftimefromthecommitmentofcashforpurchasesuntilthecollectionofreceivablesresultingfromthesaleofgoodsorservices.ThediagramnearthebeginningofChapter4illustratesthisconcept.b.Ifthenormalcollectionintervalofareceivablesislongerthanayear(suchaswithlongerterminstallmentreceivables),thentheirinclusionascurrentassetsisproperprovidedtheoperatingcycleisequaltoorgreaterthantheobligationduedateforthereceivables.Similarly,ifinventories,bybusinessneedorcustom,havetobekeptonaverageformorethan12months,thenthisnormalinventoryholdingperiodbecomespartoftheoperatingcycleandsuchinventoriesareincludedamongcurrentassets.c.Thelimitationsofthecurrentratio(whichiscomputedfromitemsdefinedasworkingcapital)asameasureofshort-termliquidityarediscussedinChapter11.Still,ifweacceptthepropositionthatitisusefultomeasurethecurrentresourcesavailabletopaycurrentobligations,thenitisdifficulttoseehowextensionofcurrentfromthecustomary12monthstoperiodsof36monthsorlongercanserveausefulpurpose.Theoperatingcycleconceptmayhelpcompaniesshowth