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.
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