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.
Sears the Company being examined
1. Stockholders’ Equity1. Determine how Sears got its initial financial start in terms of debt (liabilities) or equity (capital). Support your response.
2. Analyze the equity section of Sear’s balance sheet as compared to Sear’s industry average. Rate the company’s performance against its competitors.
3. Review Sear’s dividend policy and its history. Based on the information, discuss the trends over the past year.
2. Income Measurement/Revenue Recognition1. 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 sears.
2. Review Sear’s revenue over the past two years. Analyze the change in revenue (increase/decrease) and give the reasons for this change.
3. Reflecting upon Sear's balance sheet, identify the unearned revenue accounts listed. How does your sears handle the proper accounting treatment with regard to recognizing revenue from unearned revenue accounts?