http://www.vancouversun.com/business/asia-pacific/Monday+Trading+sinks+finish+flat+after+Greek+debt+downgrade/3153914/story.html
Summary
Due to the Greece’s recent decline in economic status, Toronto Stock Exchange (TSX) finishes flat for the session ended. North American markets have been rising by triple digits in morning trades, with S&P/TSX Composite index up 114 points at 9am. However, following Moody’s comments about the Greek economy, the S&P/TSX Composite index ended the day with only a net gain of 0.42 of a point. The S&P/TSX Venture Composite index fell 7.63 points.
Connection
We are seeing a global trend of odd changes in currency values and the stock market due to the huge debt Greece has got into, and to those who have physical cash in their hands or pockets right now, you are in big trouble. As currency rates change, so does the face value of your money. In chapter 6, we were introduced to the risk of having cash on hand, and the best thing to do with it is to invest it in short-term, marketable securities such as bonds and stocks so that the face value of your money will not decline as you have bought into a certain security with a certain currency and a specific time. The only thing that can then change the value of your money is the value of the stock, and not the face value of the currency.
Reflection
It really sucks to have the world once again suffer from an economic slump. The rest of the world is slowly recovering in their status, and Greece pulls out a huge debt right out of their pocket and is on the brink of declaring bankruptcy, and the last thing anyone wants is the stock market to crash again. Many Economists believed that here in Vancouver, it is becoming a W-shaped economy. What that means is the economy suffers a slump, makes a slight attempt to get back on track, and then crashes again before it fully recovers. They believed that the Vancouver 2010 Winter Olympics created a fake hope in the economy, and now with the slump in Greece, many truly believe that we are due for another downfall…
Clement Ip
Wednesday, June 16, 2010
Wednesday, April 14, 2010
Rebranding Red Apple Entertainment
http://franticfilms.com/news
(click on Red Apple Entertainment dated January 28, 2010)
Summary
Canada’s leading film and TV production company, Frantic Films, is rebranding Red Apple Entertainment, a Toronto-based production company which the company acquired in December 2008. This means that all operations in film, television commercials, and all branded content will now carry the Frantic Films name.
Connection
When rebranding Red Apple Entertainment, the cash flow statement was much more effective than the income statement in terms providing information for cash. What information am I talking about? Frantic Films needed to know one thing, and that is if they had enough cash to go through with this project. In the income statement, you will find revenue and expenses. However, revenue generated does not necessarily mean an inflow of cash. For example, when Frantic Films undergoes projects in film production, they are to generate revenue on a percentage of completion method because usually it takes years to finish a movie. Also, as they generate this revenue, it might be on credit, so Frantic Films might have earned revenue, but cash hasn’t even been collected yet. That’s the advantage cash flow statement has over income statement.
Reflection
Upon further research, Frantic Films is the company behind the computer-generated visual effects in films like Superman Returns and X2: X-Men United. It has also produced a number of lifestyle programs for the Life Network and History Channel. They were able to be successful because their initial goal was to grow the company out of cash flow and debt. What that means is when they undergo projects, they will have to increase debt to produce the project. Then, as soon as possible, pay off their debts with liquid cash. Because of their healthy cash flow statement, they are able to get more debt if they need to finance their growth. Having enough cash is the one most important factor when trying to borrow money from a bank. Banks want their money back, and if they know you will have enough cash inflow in the company, they will gladly lend money. Following that exact trend of borrowing money and paying the banks back asap, they have become the leading film and TV production company in Canada.
(click on Red Apple Entertainment dated January 28, 2010)
Summary
Canada’s leading film and TV production company, Frantic Films, is rebranding Red Apple Entertainment, a Toronto-based production company which the company acquired in December 2008. This means that all operations in film, television commercials, and all branded content will now carry the Frantic Films name.
Connection
When rebranding Red Apple Entertainment, the cash flow statement was much more effective than the income statement in terms providing information for cash. What information am I talking about? Frantic Films needed to know one thing, and that is if they had enough cash to go through with this project. In the income statement, you will find revenue and expenses. However, revenue generated does not necessarily mean an inflow of cash. For example, when Frantic Films undergoes projects in film production, they are to generate revenue on a percentage of completion method because usually it takes years to finish a movie. Also, as they generate this revenue, it might be on credit, so Frantic Films might have earned revenue, but cash hasn’t even been collected yet. That’s the advantage cash flow statement has over income statement.
Reflection
Upon further research, Frantic Films is the company behind the computer-generated visual effects in films like Superman Returns and X2: X-Men United. It has also produced a number of lifestyle programs for the Life Network and History Channel. They were able to be successful because their initial goal was to grow the company out of cash flow and debt. What that means is when they undergo projects, they will have to increase debt to produce the project. Then, as soon as possible, pay off their debts with liquid cash. Because of their healthy cash flow statement, they are able to get more debt if they need to finance their growth. Having enough cash is the one most important factor when trying to borrow money from a bank. Banks want their money back, and if they know you will have enough cash inflow in the company, they will gladly lend money. Following that exact trend of borrowing money and paying the banks back asap, they have become the leading film and TV production company in Canada.
Tuesday, March 2, 2010
Outpost Excahnge Expands Online
http://www.bizjournals.com/milwaukee/stories/2009/05/04/daily3.html
Summary
Outpost Exchange Magazine, a publication of Outpost Natural Foods, a cooperative, community- owned grocery store, will begin publishing its free monthly magazine online. In addition to publishing their magazine print content on the Third Coast Digest, Outpost Exchange columnists and editors will blog throughout the month to share newest thoughts about nutrition and food. Outpost started publishing their magazine as part of the Third Coast Digest in March of 2009, and will continue to print 30,000 copies of magazine and make them available at numerous stores in Milwaukee.
Connection
Upon further research, the reason why Outpost went online was because a lot of printing companies failed due to the economic slump. In order to make up for the lost magazines, they decided to go online. Circulation, in terms of magazines, is the number of copies the company distributes for each issue. When Outpost Exchange publishes its next issue and sends it to subscribers, stores, and the Third Coast, they will recognize revenue at the end of every other month since Outpost Exchange publishes a new magazine issue 6 months a year. Revenue will only be recognized when they receive cash. Recognition of revenue from subscribers and from stores around Milwaukee will be the same for the period ended because usually magazines are sold and published online at the very same time.
Reflection
I actually believe the reason why Outpost went online and cut the amount of copies published because it actually increases the amount of circulation for the company. Circulation is the number of copies the company distributes for each issue. Now with the free online print content, more people will read the magazine. More people reading the magazine will require a larger number of circulation. This is the leading factor when used to set advertising rates. The higher the circulation, the more people reading the magazine, the higher the rates will be. By going online for free, Outpost has attracted an extra wave of readers. Now advertisements that are placed on their website and on their magazines will cost more. Even though they have cut down on the amount of printed copies sold, they are earning extra revenue from advertisers. That was a smart move by Outpost.
-Clement Ip
Summary
Outpost Exchange Magazine, a publication of Outpost Natural Foods, a cooperative, community- owned grocery store, will begin publishing its free monthly magazine online. In addition to publishing their magazine print content on the Third Coast Digest, Outpost Exchange columnists and editors will blog throughout the month to share newest thoughts about nutrition and food. Outpost started publishing their magazine as part of the Third Coast Digest in March of 2009, and will continue to print 30,000 copies of magazine and make them available at numerous stores in Milwaukee.
Connection
Upon further research, the reason why Outpost went online was because a lot of printing companies failed due to the economic slump. In order to make up for the lost magazines, they decided to go online. Circulation, in terms of magazines, is the number of copies the company distributes for each issue. When Outpost Exchange publishes its next issue and sends it to subscribers, stores, and the Third Coast, they will recognize revenue at the end of every other month since Outpost Exchange publishes a new magazine issue 6 months a year. Revenue will only be recognized when they receive cash. Recognition of revenue from subscribers and from stores around Milwaukee will be the same for the period ended because usually magazines are sold and published online at the very same time.
Reflection
I actually believe the reason why Outpost went online and cut the amount of copies published because it actually increases the amount of circulation for the company. Circulation is the number of copies the company distributes for each issue. Now with the free online print content, more people will read the magazine. More people reading the magazine will require a larger number of circulation. This is the leading factor when used to set advertising rates. The higher the circulation, the more people reading the magazine, the higher the rates will be. By going online for free, Outpost has attracted an extra wave of readers. Now advertisements that are placed on their website and on their magazines will cost more. Even though they have cut down on the amount of printed copies sold, they are earning extra revenue from advertisers. That was a smart move by Outpost.
-Clement Ip
Tuesday, January 19, 2010
Suncor rescues fire
http://www.suncor.com/en/newsroom/2418.aspx?id=1092394
Summary
Suncor Energy Inc. is assessing the damages of the fire that happened at one of the company’s two oil sands upgraders in Alberta. The fire occurred on December 15 at around 10 a.m. and was extinguished within one hour. Early reports show that no structural damage, environmental impacts, and injuries occurred because of the fire, and repairs to the oil sands upgraders will take between 2-4 weeks. During the repair week, Suncor’s production is anticipated to be reduced by 120,000 to 150,000 barrels of crude oil per day.
Connection
Suncor Energy Inc. does their financial statements monthly so that their stakeholders can get a sense of the company’s performance and financial status. Since the fire occurred on December 15 and the repairs are said to be finished within 2-4 weeks, we can assume that the fiscal period of December 2009 will end before the oil sands upgraders will be fully restored. This will affect the income statement for the fiscal period. Repairs expense for this particular event will not fall under the Normal Income from Continuing Operations category on the Multi-step income statement because fires do not occur frequently. Instead, it will be recorded under Gains or Losses from Unusual or Infrequent Sources as fires are not expected to occur.
Reflection
Stakeholders are a person, group, or organization that has stake in an organization because it can affect or be affected by the organization’s actions, objectives, and policies. That includes creditors, consumers, all the employees of the company, owners, shareholders, suppliers, unions, government, etc. Suncor Energy Inc. is committed to producing monthly statements to provide valuable information to their stakeholders, and that is a very strong decision being made. By providing this information, it enables everyone to see and analyze the performance of the company, and to predict future decisions. For employees who just want to work and make a living, having this information can also encourage employee loyalty.
Also, closing books after one month allows financial information to be up-to-date. Investors, government, banks, and all sorts of financial data users always look for the most up-to-date information, and Suncor will be able to provide it efficiently every time as it is already part of their monthly routine.
Summary
Suncor Energy Inc. is assessing the damages of the fire that happened at one of the company’s two oil sands upgraders in Alberta. The fire occurred on December 15 at around 10 a.m. and was extinguished within one hour. Early reports show that no structural damage, environmental impacts, and injuries occurred because of the fire, and repairs to the oil sands upgraders will take between 2-4 weeks. During the repair week, Suncor’s production is anticipated to be reduced by 120,000 to 150,000 barrels of crude oil per day.
Connection
Suncor Energy Inc. does their financial statements monthly so that their stakeholders can get a sense of the company’s performance and financial status. Since the fire occurred on December 15 and the repairs are said to be finished within 2-4 weeks, we can assume that the fiscal period of December 2009 will end before the oil sands upgraders will be fully restored. This will affect the income statement for the fiscal period. Repairs expense for this particular event will not fall under the Normal Income from Continuing Operations category on the Multi-step income statement because fires do not occur frequently. Instead, it will be recorded under Gains or Losses from Unusual or Infrequent Sources as fires are not expected to occur.
Reflection
Stakeholders are a person, group, or organization that has stake in an organization because it can affect or be affected by the organization’s actions, objectives, and policies. That includes creditors, consumers, all the employees of the company, owners, shareholders, suppliers, unions, government, etc. Suncor Energy Inc. is committed to producing monthly statements to provide valuable information to their stakeholders, and that is a very strong decision being made. By providing this information, it enables everyone to see and analyze the performance of the company, and to predict future decisions. For employees who just want to work and make a living, having this information can also encourage employee loyalty.
Also, closing books after one month allows financial information to be up-to-date. Investors, government, banks, and all sorts of financial data users always look for the most up-to-date information, and Suncor will be able to provide it efficiently every time as it is already part of their monthly routine.
Thursday, November 26, 2009
Redo of Chapter 2 Blog
http://www.thestar.com/business/article/709304--siemens-gets-ontario-wind-turbine-order
Summary
Siemens AG has been picked to supply 250 wind turbines, worth US$ 888 million, to the United States and Canada. One fourth of the orders are going to unspecified projects in Ontario, while the other turbines will be sent to California, Oklahoma, Washington, and Wyoming. To undergo this project, Siemens in North America needs all 900 workers, and is planning to increase that amount. Wolfgang Dehen, chief executive of Siemens, said that this proves a lot to the wind industry. He believes that the wind industry has a definite standing in the market and having the support from Canada and US is helping out the wind project development.
Connections
There were several connections I made between this article and the book. Revenue Recognition Criteria is the GAAP that will determine when Siemens Ag will recognize expenses and revenue. Revenue will be recognized when Siemens AG has completed the turbines or when there is a high chance that the project will be completed. Selling these 250 wind turbines of assets is considered an operating activity for the company because the wind turbines being produced have value to the company and will be of economic benefit in the future are eventually going to be sold, generating profit (or loss). Selling these assets will cause an increase in the cash flow statement of Siemens AG, resulting in an increase in the retained earnings. Lastly, Siemens AG as of right now has approximately 900 workers. When wages are not paid out yet in cash but it is the end of the period, the wages are going to be recognized in the income statement. That is an example of an accrued expense, where expenses are recognized in the income statement prior to being paid out in cash during that period.
Reflection
The wind project development’s goal is to use natural power, in this case the wind, to generate the electricity we use. I love how US, and Canada, are supporting the wind project development. This sends a message to the rest of the world that the leading producer of carbon dioxide, the US, is moving towards becoming a green country.
However, why has US and Canda turned to Siemens, a German-based company, to do the making of the turbines? Doesn't Canada and US also have the man power to create those machines? That was one thing that stumped me as I was reading the article. Nonetheless, one thing is for sure, and that is Siemens is the leading invester in ecofriendly projects. They will play a major roll in helping Canada and the US to establish a green reputation
Clement Ip
Summary
Siemens AG has been picked to supply 250 wind turbines, worth US$ 888 million, to the United States and Canada. One fourth of the orders are going to unspecified projects in Ontario, while the other turbines will be sent to California, Oklahoma, Washington, and Wyoming. To undergo this project, Siemens in North America needs all 900 workers, and is planning to increase that amount. Wolfgang Dehen, chief executive of Siemens, said that this proves a lot to the wind industry. He believes that the wind industry has a definite standing in the market and having the support from Canada and US is helping out the wind project development.
Connections
There were several connections I made between this article and the book. Revenue Recognition Criteria is the GAAP that will determine when Siemens Ag will recognize expenses and revenue. Revenue will be recognized when Siemens AG has completed the turbines or when there is a high chance that the project will be completed. Selling these 250 wind turbines of assets is considered an operating activity for the company because the wind turbines being produced have value to the company and will be of economic benefit in the future are eventually going to be sold, generating profit (or loss). Selling these assets will cause an increase in the cash flow statement of Siemens AG, resulting in an increase in the retained earnings. Lastly, Siemens AG as of right now has approximately 900 workers. When wages are not paid out yet in cash but it is the end of the period, the wages are going to be recognized in the income statement. That is an example of an accrued expense, where expenses are recognized in the income statement prior to being paid out in cash during that period.
Reflection
The wind project development’s goal is to use natural power, in this case the wind, to generate the electricity we use. I love how US, and Canada, are supporting the wind project development. This sends a message to the rest of the world that the leading producer of carbon dioxide, the US, is moving towards becoming a green country.
However, why has US and Canda turned to Siemens, a German-based company, to do the making of the turbines? Doesn't Canada and US also have the man power to create those machines? That was one thing that stumped me as I was reading the article. Nonetheless, one thing is for sure, and that is Siemens is the leading invester in ecofriendly projects. They will play a major roll in helping Canada and the US to establish a green reputation
Clement Ip
Tuesday, October 13, 2009
Chapter 2- Siemens AG receives big orders from Canada and US
http://www.thestar.com/business/article/709304--siemens-gets-ontario-wind-turbine-order
Summary
Siemens AG has been picked to supply 250 wind turbines, worth US$ 888 million, to the United States and Canada. One fourth of the orders are going to unspecified projects in Ontario, while the other turbines will be sent to California, Oklahoma, Washington, and Wyoming. To undergo this project, Siemens in North America needs all 900 workers, and is planning to increase that amount. Wolfgang Dehen, chief executive of Siemens, said that this proves a lot to the wind industry. He believes that the wind industry has a definite standing in the market and having the support from Canada and US is helping out the wind project development.
Connections
There are 3 relations to the book. Firslty, when Siemens AG sells these turbines to the various places, Siemens AG will find out its profit by subtracting the expenses used to create the wind turbines with the actual worth of the turbines. That is called the net income. The net income is then debited to the cash account on the balance sheet, and credited to the retained earnings. Secondly, selling these 250 wind turbines is considered an operating activity because the wind turbines being produced are eventually going to be sold, generating profit (or loss). Selling these assets will cause an increase in the cash flow statement of Siemens AG, resulting in an increase in the retained earnings. Finally, when Siemens AG pays wages to their 900+ workers, the transaction that will be recorded is a credit to cash account and a debit retained earnings(expenses).
Reflection
The wind project development’s goal is to use natural power, in this case the wind, to generate the electricity we use. I love how US, and Canada, are supporting the wind project development. This sends a message to the rest of the world that the leading producer of carbon dioxide, the US, is turning towards becoming green country. Right now, as the economy is trying to recover from the slump it was in last year, it is all about business. In order to get people to start buying, factories, agencies, offices, and stores need to be open up a later than usual, therefore consuming more electricity. Where is this electricity going to come from? By generating this electricity with wind, expenses used to keep the wind turbines would be kept low, and a lot more within the business world can be done.
Clement Ip
Summary
Siemens AG has been picked to supply 250 wind turbines, worth US$ 888 million, to the United States and Canada. One fourth of the orders are going to unspecified projects in Ontario, while the other turbines will be sent to California, Oklahoma, Washington, and Wyoming. To undergo this project, Siemens in North America needs all 900 workers, and is planning to increase that amount. Wolfgang Dehen, chief executive of Siemens, said that this proves a lot to the wind industry. He believes that the wind industry has a definite standing in the market and having the support from Canada and US is helping out the wind project development.
Connections
There are 3 relations to the book. Firslty, when Siemens AG sells these turbines to the various places, Siemens AG will find out its profit by subtracting the expenses used to create the wind turbines with the actual worth of the turbines. That is called the net income. The net income is then debited to the cash account on the balance sheet, and credited to the retained earnings. Secondly, selling these 250 wind turbines is considered an operating activity because the wind turbines being produced are eventually going to be sold, generating profit (or loss). Selling these assets will cause an increase in the cash flow statement of Siemens AG, resulting in an increase in the retained earnings. Finally, when Siemens AG pays wages to their 900+ workers, the transaction that will be recorded is a credit to cash account and a debit retained earnings(expenses).
Reflection
The wind project development’s goal is to use natural power, in this case the wind, to generate the electricity we use. I love how US, and Canada, are supporting the wind project development. This sends a message to the rest of the world that the leading producer of carbon dioxide, the US, is turning towards becoming green country. Right now, as the economy is trying to recover from the slump it was in last year, it is all about business. In order to get people to start buying, factories, agencies, offices, and stores need to be open up a later than usual, therefore consuming more electricity. Where is this electricity going to come from? By generating this electricity with wind, expenses used to keep the wind turbines would be kept low, and a lot more within the business world can be done.
Clement Ip
Wednesday, September 16, 2009
Summary
Scotiabank recently introduced its Small Business Banking initiative to Greater Toronto Area. This is a 5 month tour that will include Scotiabank’s Small Business Banking tools, services, and experts, all for the purpose of hoping to give financial advice and strategies to small business owners in the Greater Toronto Area to help their businesses grow. Scotiabank is targeting GTA because Ontario is still suffering from the effects of the U.S. downturn and a slight increase in gas and oil prices, and small businesses being able to prosper in the Greater Toronto Area will definitely help out Ontario’s economic state. The GTA remains an attractive place and expanding business in the area is not a problem because it is a very well-educated and service-oriented economy.
http://www.accountingworld.ca/aw_new_2008_09_23_2.htm
Connections
In order for Scotiabank to fully understand the financial status of the businesses in the Greater Toronto Area, accountants have to prepare different financial statements including balance sheets and income statements. Both of these statements are able to fully identify the business’s assets, liabilities, earnings, and ultimately the financial status of the business. Also, the information Scotiabank obtains from the financial statements can also be passed on to other external users such as credit-rating agencies. Credit- rating agencies give a credit rating of businesses based on how well they are able to pay off their debts. After knowing all the necessary information, this is when Scotiabank experts step in and provide knowledgeable judgments about possible business related events. Accountants will play a big role in preparing financial information to Scotiabank in order for their Small Business Banking initiative to be a success.
Reflection
It is great that Scotiabank is campaigning in such a big project. What this does is it is setting a spark into Toronto and Ontario’s economy. Toronto is a well known place, and being able to prosper the area with small businesses can really make a difference. However, can this little spark in a small area of Toronto help Canada the nation itself? Scotiabank has started something very crucial to our economy, and I think that it is just a matter of time until other banks would follow. A little action in the Greater Toronto Area might be able to bring Toronto out from economic adversity, so maybe a little action everywhere can truly recover Canada from economic slump.
-Clement Ip
Scotiabank recently introduced its Small Business Banking initiative to Greater Toronto Area. This is a 5 month tour that will include Scotiabank’s Small Business Banking tools, services, and experts, all for the purpose of hoping to give financial advice and strategies to small business owners in the Greater Toronto Area to help their businesses grow. Scotiabank is targeting GTA because Ontario is still suffering from the effects of the U.S. downturn and a slight increase in gas and oil prices, and small businesses being able to prosper in the Greater Toronto Area will definitely help out Ontario’s economic state. The GTA remains an attractive place and expanding business in the area is not a problem because it is a very well-educated and service-oriented economy.
http://www.accountingworld.ca/aw_new_2008_09_23_2.htm
Connections
In order for Scotiabank to fully understand the financial status of the businesses in the Greater Toronto Area, accountants have to prepare different financial statements including balance sheets and income statements. Both of these statements are able to fully identify the business’s assets, liabilities, earnings, and ultimately the financial status of the business. Also, the information Scotiabank obtains from the financial statements can also be passed on to other external users such as credit-rating agencies. Credit- rating agencies give a credit rating of businesses based on how well they are able to pay off their debts. After knowing all the necessary information, this is when Scotiabank experts step in and provide knowledgeable judgments about possible business related events. Accountants will play a big role in preparing financial information to Scotiabank in order for their Small Business Banking initiative to be a success.
Reflection
It is great that Scotiabank is campaigning in such a big project. What this does is it is setting a spark into Toronto and Ontario’s economy. Toronto is a well known place, and being able to prosper the area with small businesses can really make a difference. However, can this little spark in a small area of Toronto help Canada the nation itself? Scotiabank has started something very crucial to our economy, and I think that it is just a matter of time until other banks would follow. A little action in the Greater Toronto Area might be able to bring Toronto out from economic adversity, so maybe a little action everywhere can truly recover Canada from economic slump.
-Clement Ip
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