SNHU Final Project Milestone One: Stockholders' Equity and Revenue Recognition

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Business Finance

Southern New Hampshire University

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3-2 Final Project Milestone One: Stockholders' Equity and Revenue Recognition Assignment

Task: Submit to complete this assignment

By continuing to use the company that you adopted in ACC 610, you will apply the technical competence and other skills required by today's CPAs. Through case-study analysis, you will develop skills such as communication, presentation, and interpersonal relations in conjunction with technical accounting knowledge.

ACC 620: Financial Reporting II is a continuation of ACC 610. In ACC 620, your focus in the final project will be on developing skills in critical thinking and applying accounting theories and practices, according to generally accepted accounting principles (GAAP). You will be analyzing situations and communicating results to decision makers with an emphasis on stockholders' equity, income measurement, income taxes, pensions, leases, and statements of changes in financial positions.

  1. Stockholders' Equity
    1. Determine how your company got its initial financial start in terms of debt (liabilities) or equity (capital). Support your response.
    2. Analyze the equity section of your company's balance sheet as compared to your company's industry average. Rate the company's performance against its competitors.
    3. Review your company's dividend policy and its history. Based on the information, discuss the trends over the past year.
  2. Income Measurement/Revenue Recognition
    1. Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) came together on a unified project to outline the accounting principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and IFRS. Research IAS-18, Revenue, and discuss how it would apply to your company.
    2. Review your company's revenue over the past two years. Analyze the change in revenue (increase/decrease) and give the reasons for this change.
    3. Reflecting upon your company's balance sheet, identify the unearned revenue accounts listed. How does your company handle the proper accounting treatment with regard to recognizing revenue from unearned revenue accounts?

For additional details, please refer to the Milestone One Guidelines and Rubric document.

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Explanation & Answer

Attached.

Running Head: STOCKHOLDERS’ EQUITY AND REVENUE RECOGNITION

Stockholders’ Equity and Revenue Recognition
Name
Institution
Course
Date

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STOCKHOLDERS’ EQUITY AND REVENUE RECOGNITION

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Introduction
Walmart's is a multinational retail chain store that operates across the world under the
slogan of saving money and living better. The company thus focus on creating great value
through the provision of great customer service. Therefore, the revenue recognition and
stockholders equity measures that the company has taken have all revolved towards helping it
achieve its mission. Below is a description of the company's stockholders equity and revenue
recognition measures for the past two years (Walmart, 2019).
Financial Start
The initial financial start of Walmart in terms of equity (capital) can be traced
from the history of the company back in 1952 when it was started with an initial investment
capital of US$1.7 million. Using this startup capital generated from personal savings, Sam
Walton started Walton 5&10 on the downtown square of Bentonville, Arkansas and later
expanded its operations to Rogers, Arkansas in 1962. By 1967, the company had over 24 stores
generating up to U.S. $12.7 million in sales which was invested back into the company to expand
operations.
The company banked on a low-cost operation to provide exemplary customers to its
customers at lower prices. Later own, the Company ...


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