ING ANALYSIS PROJE (This ongoing project began in Module 1 and continues through most of the...

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ING ANALYSIS PROJE (This ongoing project began in Module 1 and continues through most of the book; even if previous segments wer not completed, the requirements are still applicable to any business analysis.) Analysis of financial statemen commonly includes operating income and its components as explained in this module. 1. Revenue Recognition Revenue is the largest item on the income statement, and we must assess it on a quant tive and qualitative basis. . . . Use horizontal analysis to identify any time trends. Compare the horizontal analyses of the two companies. Consider the current economic environment and the companies' competitive landscape. Given they op in the same industry, you might expect similar revenue trends. Read the management's discussion and analysis (MD&A) section of the 10-K to learn how the comp senior managers explain revenue levels and changes. wwwwwwwwwwww Cambridge Business Publishers Module 5 | Revenue Recognition and Operating Income Our goal is to determine whether each company's revenue levels and changes seem appropriate and in line with external factors. Additional analysis: (a) If the company distinguishes among types of revenue on the income statement, use horizontal and vertical analyses to identify any changes in the product line mix or where sales are growing most quickly. Find the footnote on segment revenues and profits, and identify trends or significant changes. (b) Assess each company's revenue recognition policy by comparing it with the other and with those of some other close competitors. (c) Consider unearned revenue on the balance sheet. How big is it (common size), and is it fluctuating over time? (d) For companies that operate globally, determine the effect of foreign currency fluctuations on revenue. If these are substantial year after year, it might indicate that managers are not effectively hedging, and this would warrant additional investigation. dac come guidance for analyzing a company's accounts receivable. the companies' ING ANALYSIS PROJE (This ongoing project began in Module 1 and continues through most of the book; even if previous segments wer not completed, the requirements are still applicable to any business analysis.) Analysis of financial statemen commonly includes operating income and its components as explained in this module. 1. Revenue Recognition Revenue is the largest item on the income statement, and we must assess it on a quant tive and qualitative basis. . . . Use horizontal analysis to identify any time trends. Compare the horizontal analyses of the two companies. Consider the current economic environment and the companies' competitive landscape. Given they op in the same industry, you might expect similar revenue trends. Read the management's discussion and analysis (MD&A) section of the 10-K to learn how the comp senior managers explain revenue levels and changes. wwwwwwwwwwww Cambridge Business Publishers Module 5 | Revenue Recognition and Operating Income Our goal is to determine whether each company's revenue levels and changes seem appropriate and in line with external factors. Additional analysis: (a) If the company distinguishes among types of revenue on the income statement, use horizontal and vertical analyses to identify any changes in the product line mix or where sales are growing most quickly. Find the footnote on segment revenues and profits, and identify trends or significant changes. (b) Assess each company's revenue recognition policy by comparing it with the other and with those of some other close competitors. (c) Consider unearned revenue on the balance sheet. How big is it (common size), and is it fluctuating over time? (d) For companies that operate globally, determine the effect of foreign currency fluctuations on revenue. If these are substantial year after year, it might indicate that managers are not effectively hedging, and this would warrant additional investigation. dac come guidance for analyzing a company's accounts receivable. the companies'