Question
RadioShack entered into a sale/leaseback of its corporate campus in 2005 . (Use the RadioShack sale/leaseback documents/disclosures and the excerpts from the 2007 and 2008
RadioShack entered into a sale/leaseback of its corporate campus in 2005. (Use the RadioShack sale/leaseback documents/disclosures and the excerpts from the 2007 and 2008 RadioShack annual reports, Be careful the questions ask questions regarding multiple years.
Why did RadioShack enter into the 2005 sale/leaseback transaction?
What economic advantages do you see in the 2005 sale/leaseback?
What economic disadvantages do you see in the 2005 sale/leaseback?
What financial reporting (accounting) advantages do you see in the 2005 sale/leaseback?
At December 31, 2005, what was RadioShack obligated to pay in minimum lease payments for the corporate campus? Was this amount reflected on RadioShacks 2005 balance sheet? Why or why not?
What was the company's total future minimum rent commitments as of December 31, 2007?
What is your personal view of the accounting rules applying to leases? Do you think investors were provided with sufficient information to understand RadioShacks future obligations with respect to the corporate campus lease and its store leases?
The RadioShacks Annual Reports are at
http://www.radioshackcatalogs.com/annual_reports.html
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