View Homework Help – Harnischferger Case from ACG at Florida International University. Harnischfeger Corporation 1. Describe clearly the accounting. Agenda Case Facts Strategy Analysis Accounting Analysis. Directions Read the “Harnischfeger Corp” case study and answer the following questions. Submit your completed assignment no later than the last day of Week .
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Inan estimate of 6. They argue that there are some sophisticated analysts who could perform the analysis that was done in the class.
Also, profit margin dropped from 1. If people adjust for the differences in accounting policies when they compare us with other companies, then it should not matter whether we follow conservative or liberal policies. How much did the pre-tax income increase as a result of the changed ratio in ?
The straight-line method will allow the assets to continue to depreciate in the same amount for the life of the caee. We would like to tell the world that we are alive and well.
Be as specific as possible. We think you have liked this presentation. Pension Gain and rate of return Components of Pension Expense: Even thought the changes indicate an optimistic move, it does not guarantee that the company is going to be able to implement its business plan.
Students point out a number of possible motives for the accounting changes: When the outside world compares our financial performance with that of other companies, they may or may not take the time and effort to xorporation the effects of the differences in financial policies that various companies follow.
Rivalry is High – less for ITG. This is likely to happen if there are no significant penalties associated with cawe behavior. See Exhibit 4, Note 2, in the case.
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In my opinion, the changed accounting format highlights the effectiveness of our strategy better than the old policies do. However, the evidence presented in these studies is not conclusive. The company adjusted its allowance for doubtful accounts to 6.
The instructor can sum up the class discussion on question 2 by mentioning the views of the management described above. The company changed its accounting for duration patterns and tooling. Boost stock price to raise new capital Meet earnings targets for compensation Avoid violating debt covenants Improve image with customers, suppliers, etc.
I am not sure whether people make the adjustments or not, dorporation either way we wish to present an optimistic version of the picture and let people figure out what to do with the numbers. Change in the allowance for doubtful accounts. They need to stop playing with accounting methods and hiding stjdy true story otherwise they will be in danger to not survive in a long run. Auth with social network: But suppose they do not adjust.
How will this change affect future reported profits? The reduction in benefits and wedges were significant from to How to Write a Summary of an Article?
By changing the fiscal year of foreign subsidiaries ending period of September 30 instead of July 31the effect was harnisdhfeger lengthening of the reporting period for the subsidiaries from 12 months to 14 months.
Therefore, the accounting changes helped the management report a stuudy profit rather than a modest loss. Accounting statements are used by investors, lenders, customers, employees, and governments in dealing with Harnischfeger.
The company reported that Harnischfeger Engineers received a major order for the design of an automated car assembly plant.
I am corporatiom sure whether people make the adjustments or not, but either way we wish to present an optimistic version of the picture and let people figure out what to do dorporation the numbers. Low Similar price and Performance Consumers willingness to switch products -Low. The liquidation means selling of older inventory since the current sales are higher then current purchases then harnischfsger liquidation will occur and as result any inventory not sold in previous periods must be liquidated.
Grade was appointed as the president and chief operating officer COO. Also, the company continued to liberalize its financial reporting policies. As can be seen, Harnischfeger seems to have succeeded in implementing its strategy effectively. Harnischfeger Case Group Members: Are these changes likely to affect future profits?
The company considered the offer inadequate and rejected it. Bad debt reserve is an estimate of accounts receivable that will not be collected. In any case, these adjustments impose a cost on the user. Goessel was the president and COO, and Mr. I feel that the financial reporting should help rather than hinder the implementation of our operating strategy. The pension plan changes affected positively the statements in If you wish to download it, please recommend it to your friends in any social system.
The total cash-flow analysis, shown in Exhibit 1, indicates that the company has been able to generate positive cash flow from its operations in What are the economic consequences of these changes to Harnischfeger and its workers?