Intermediate Accounting - Example

The paper "Intermediate Accounting" is a great example of a report on finance and accounting. The paper's purpose is to evaluate the past and future financial performance of the company and choose the most attractive and lucrative investment opportunity for the company. For this purpose, the past financial performance reflects that the company has not been generating more net sales but has been struggling to generate enough sales. And the future expected trend is also reflecting that the company will not be to generate enough net sales.

At the same time, its ratios are decreasing, demonstrating that the company is not financially vibrant. For this purpose, two investment options (purchase of a new production plant or buying a new company) have been highlighted and discussed. The subsequent results reflect that the purchase of the new plant has been offered either through lease agreement or through the direct purchase decision. Subsequently, for buying a new company, two investment options have been considered in which the first highlights merger and second requires acquisition.

After a careful analysis, it has been concluded and recommended that the new production plant should be chosen rather than merging or acquiring the new company. And the new production plant should be purchased through a finance lease agreement. In addition, the company should use NPV as the main method for highlighting the inflows. For managing both internal and external risks, it is highly recommended that the company should use local currency, hedging strategies, reduce projected sales, convince reluctant employees through providing and offering them more lucrative incentives and perks and arrange funds through issuing shares instead of using debentures.

Introduction Custom Snowboards Inc. has two attractive opportunities for investing in the European market. The first opportunity is in the form of procuring a new production plant and the second investment option is either to acquire or merge with a European SnowFun firm. Each investment opportunity has different net sales, net earnings, and cost payments as well. Currently, the company management has decided to choose one but a cost-effective and financially lucrative investment option for the company, especially in the European market.

For this purpose, it has financially and operationally analyzed both investment opportunities in which lease payments, total net sales, and net earnings have been taken into account.