Explore BrainMass
Share

Financial Accounting Balance Sheet Apple vs Philips

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

The case requires you to analyze the balance sheet for the two companies in more detail.

Is there a difference in approach to valuation by US GAAP and IFRS? Discuss and note two or three specific differences. In addition, briefly:

Distinguish between an expense (expired cost) and an asset.
Distinguish between current and long-term assets.
Distinguish between current and long-term liabilities.
Review Apple's balance sheet and provide two examples of each of the above categories.
Discuss retained earnings and how income or loss and dividends affect this account. Review Apple's retained earnings account and explain how it changes between the two past years.
Comment on at least three differences between Apple's and Philips' balance sheets.
Does Apple or Philips have more debt?
Which of the two companies is the bigger one? Explain your reasoning.

Modular Case Expectations

It is important to answer the questions as posed. The discussion should be three to five pages and written in a clear and concise manner. Support your discussion with references in APA format. You are encouraged to use Excel or other compatible spreadsheet when computations are involved.

© BrainMass Inc. brainmass.com March 22, 2019, 12:59 am ad1c9bdddf
https://brainmass.com/business/balance-sheet/519940

Solution Preview

Is there a difference in approach to valuation by US GAAP and IFRS? Discuss and note two or three specific differences.

US GAAP prefers historical cost, especially for long-term assets. It also shows the most liquid asset first and the least liquid asset last. IFRS permits revaluation of long-term assets and shows the least liquid asset first and the most liquid asset (cash) last on the balance sheet (see Excel, attached, for the balance sheet of Apple and Philips as an example of this).

Distinguish between an expense (expired cost) and an asset.

An asset is something acquired that has future value (not yet used up). An expense is an expenditure that is not expected to have future value or is used up. Inventory is an asset (can be used to satisfy a customer in a future period) until used it (sold to customer) when it is expensed and becomes cost of goods sold. Once sold, it has no future value because it cannot be resold to another customer.

Distinguish between current and long-term assets. ...

Solution Summary

Your tutorial is 482 words plus an excel sheet that has a cut and paste of the two balance sheets and a computation of debt to asset ratio.

$2.19