财务报表分析与运用 杰拉尔德 课后答案英文版第七章.docx
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财务报表分析与运用杰拉尔德课后答案英文版第七章
Chapter7Solutions
Overview:
ProblemLengthProblem#s
{S}2,3,5,8,and10
{M}1,4,6,7,9,11,12,and13
Appendices
{M}7A-1and7B-1
{L}7A-2and7B-2
1.{M}Exhibit7S-1containsthecalculationsrequired.
Exhibit7S-1.Chevron
AdjustmentsforCapitalizationofInterest
Amountsin$millions
partc
Year
1995
1996
1997
1998
1999
1999/95
Asreported
Interestexpense
$401
$364
$312
$405
$472
1.18
Pretaxincome
1,789
4,740
5,502
1,834
3,648
2.04
Netincome
930
2,607
3,256
1,339
2,070
2.23
Capitalizedinterest
141
108
82
39
59
Amortizationofcapitalizedinterest
47
24
28
35
9
a.Calculations
EBIT
$2,190
$5,104
$5,814
$2,239
$4,120
Timesinterestearned
5.46
14.02
18.63
5.53
8.73
1.60
b.Adjusted
Netcapitalizedinterest
$94
$84
$54
$4
$50
After35%incometax
61
55
35
3
33
Interestexpense
542
472
394
444
531
0.98
EBIT
2,237
5,128
5,842
2,274
4,129
（i）Timesinterestearned
4.13
10.86
14.83
5.12
7.78
1.88
（ii）%reductionfromreportedratio
-24.4%
-22.5%
-20.4%
-7.4%
-10.9%
Pretaxincome
$1,695
$4,656
$5,448
$1,830
$3,598
2.12
（iii）Netincome
869
2,552
3,221
1,336
2,038
2.34
%reductionfromreported
-6.6%
-2.1%
-1.1%
-0.2%
-1.6%
b.（iv）Expensingallinterestreducesnetincomeforeachyear.Howevertheeffectdiminishesovertime.
c.（i）Becausetheamountofinterestcapitalizeddeclinedovertime,restatementreducestherateofincreaseininterestexpense.
（ii）Whiletheinterestcoverageratioislowerafterrestatement,itstrendimprovesduetothelowergrowthrateofinterestexpense.
（iii）Bothpretaxandnetincomearelowerafterrestatementbuttheirgrowthrateimprovesduetothelowergrowthrateofinterestexpense.
d.Therestateddataaremoreusefulforfinancialanalysisbecausetheyarebasedonactualinterestexpense.Theyprovidebettercomparabilitywithfirmsthatdonotcapitalizeinterest.
2.{S}a.（i）Interestcostcanbecapitalizedonborrowingsdirectlyassociatedwiththeprojectorwhenthecompanyhasdebtequaltoorexceedingthecostofconstruction.
（ii）Start-upcostsmustbeexpensedunderU.S.GAAP.
（iii）Shippingcostsareconsideredpartofthecostofacquisition.
（iv）IncreasesinthemarketvalueoflandandbuildingsmaynotberecognizedunderU.S.GAAP.
b.（i）WhilethebenchmarktreatmentunderIAS23istoexpenseallinterest,capitalizationofborrowingcostsdirectlyattributabletoaprojectisanallowedalternative.
（ii）SameasU.S.GAAPexceptthatthebenchmarkThecapitalizationofinterestisanallowedalternativeunderIAS23（paragraph11）
（iii）SameasU.S.GAAP.
（iv）WhilerevaluationisanallowedalternativeunderIAS16,itmustbeappliedtoallassetsinaparticularclassandcouldbeselectivelyappliedtoaparticularproject.
3.{S}a.UnderSFAS86（textpage242）,computersoftwaredevelopmentcostscanbecapitalizedonlywheneconomicfeasibilityhasbeenestablished.
b.UnderIAS38（paragraph45）,intangibleassetssuchascomputersoftwarecanberecognizedwhentheenterprisecandemonstratetechnicalandeconomicfeasibility.
4.{M}Exhibit7S-2containsthecalculationsrequiredbypartsathroughc.
Exhibit7S-2
Ericsson
AmountsinSEKmillions
1997
1998
1999
Developmentcostsforsoftwaretobesold:
Openingbalance
7,398
10,744
Capitalization
5,232
7,170
7,898
Amortization
（3,934）
（3,824）
（4,460）
Writedown
（989）
Year-endbalance
7,398
10,744
13,193
Developmentcostsforsoftwareforinternaluse:
Openingbalance
Capitalization
1,463
Amortization
（152）
Year-endbalance
1,311
a.UnderSwedishGAAP:
Netsales
167,740
184,438
215,403
Pretaxincome
17,218
18,210
16,386
Totalassets
147,440
167,456
202,628
Stockholders'equity
52,624
63,112
69,176
Averagetotalassets
157,448
185,042
Averageequity
57,868
66,144
Averagestockholders’equity
57,868
66,144
Assetturnover
1.17
1.16
PretaxROE
0.31
0.25
b.Adjustments:
Developmentcostsforsoftwaretobesold:
Capitalization
5,232
7,170
7,898
Amortization
（3,934）
（3,824）
（4,460）
Writedown
（989）
Neteffect
1,298
3,346
2,449
Developmentcostsforsoftwareforinternaluse:
Capitalization
1,463
Amortization
（152）
Neteffect
-
-
1,311
Totalpretaxeffect
1,298
3,346
3,760
Adjustedpretaxincome
18,516
21,556
20,146
（i）%change
8%
18%
23%
Exhibit7S-2（continued）
Year-endbalances:
Softwaretobesold
7,398
10,744
13,193
Internalusesoftware
1,311
Total
7,398
10,744
14,504
Less:
deferredtax@35%
（2,589）
（3,760）
（5,076）
Increaseinequity
4,809
6,984
9,428
Adjustedtotalassets
154,838
178,200
217,132
（ii）%change
5.0%
6.4%
7.2%
Adjustedequity
57,433
70,096
78,604
（iii）%change
9.1%
11.1%
13.6%
c:
Adjustedaverageassets
166,519
197,666
Adjustedaverageequity
63,764
74,350
（i）Adjustedassetturnover
1.11
1.09
（ii）AdjustedpretaxROE
0.34
0.27
d.TheadjustmentsforEricssonshowthatcapitalizationofsoftwaredevelopmentcostscanhaveasignificanteffectonreportedincomeandequity,andonfinancialratios.Thereforecomparabilityrequiresthatallfirmsberestatedtothesamebasis.
e.Theamountscapitalizedhighlightexpendituresandenabletheanalysttoinquireaboutthenewproductsunderdevelopment.Theamortizationperiodusedmaybeusefulasaforecastoftheusefullifeoftheproduct.Inbothcases（capitalizationandamortization）significantchangesfrompriorperiodsmayprovideusefulsignalsofimpendingchange.
5.{S}a.Thecapitalizationoftheinvestmentindisplaysdelaystheirimpactonincomeascomparedwithexpensing.Inaddition,cashfromoperationsispermanentlyincreasedastheexpendituresareclassifiedascashflowsforinvestment.Finally,iftheseexpendituresarevolatile,capitalizationandamortizationsmoothestheimpactonreportedincome.
b.（i）In2000,thecapitalizedamountincreasedby$1,648,000.Hadpromotionaldisplaysbeenexpensed,netincomewouldbe$1,071,200（after35%tax）lower.Expensingwouldhavereducednetincomeby7.4%（$1,071.2/$14,467）.
（ii）Shareholders’equitywouldbereducedby65%of$10,099,000equalto$6,564,350or7.1%.
（iii）Reportedreturnon（average）assetsequals$14,467/[（$166,656+$140,609）/2]=9.42%
Adjustedreturnon（average）assetsequals（$14,467–$1,071）/[（$166,656-$10,099）+（$140,609-$8,451）/2]=9.28%asassetsmustbereducedbytheinvestmentinpromotionaldisplays.
6.{M}a.Brandnamesareclearlyanasset.However,itisnotclearthattheseassetsshouldbeshownoncorporatebalancesheets.
Oneadvantageofrecognizingbrandnamesiscompleteness;abalancesheetthatignoresmajorfirmassetsisoflimiteduseforanalysis.Anotheradvantageisthatthecostofacquiringordevelopingabrandnameshouldberecordedasaninvestment（asset）inordertoproperlymatchrevenuesandexpenses.
Themajordisadvantageofbrandnamerecognitionisthedifficultyofpropermeasurement.Aseachbrandnameisunique,markettransactionsarenotavailabletovaluethebrand.Thus,thevaluerecognizedissubjective;differencesacrossfirmsmayreflecteitherrealdifferencesinthevalueofthebrandsordifferentmeasurementdecisions.
Oneapproachinvolvescapitalizationoftheacquisitioncost（forpurchasedbrands）ortheadvertisingandotherdevelopmentcosts（forinternallydevelopedbrands）.Inthelattercase,itisunlikelythatthevalueofthebrandwillbeequaltothecostofdevelopment.Asuccessfulbrandwillbeworthmuchmorethanthecostofitsdevelopment;anunsuccessfulbrandmayhavenovalueatall.（Thesecharacteristicsmayalsodescribeacquiredbrands.）
Further,thevalueofbrandschangesovertime.DespitethequotationfromLaing,brandscanalsobecome"dilapidated"iftheyareneglected,iftheadvertisingispoor,oriftheproductsaredefective.Thevalueofbrandswillalsobeaffectedbychangesinmarketconditions,e.g.,pricingdecisionsandtheinroadsmadebygenericproducts.
Fromthepointofviewoffinancialanalysis,therefore,itisnotclearthatreportingmanagement'sestimateofbrandvaluewouldbehelpful.The"proofofthepuddingisintheeating"andavaluablebrandshouldbehighlyprofitable.Theevaluationofthatprofitabilitymightbebetterlefttothemarketplace.
b.Theadvantageofamortizationisthattheincomestatementshouldreflectallexpensesthathelpproduceincome.Ifprofitabilityisduetothebrandname,theamortizationofitsacquisitioncostshouldbeanelementofexpense.
Ontheotherhand,giventhesubjectivityofbrandnamevaluation,theamortizationamount（alsoaffectedbythechoiceofmethodandlife）maybeapoormeasureoftheexpiredvalue.Inaddition,brandnamesmaynotdeclineinvalueovertime;anydeclineislikelytobeirregular.
Forpurposesofanalysis,therefore,theamortizationofbrandnameintangibleassetsshouldbeexcludedfromincome.Theevaluationofprofitability,however,shouldconsidertheroleofbrandnames.
Exhibit7S-3
NorskHydro
1998R
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