0906BJCFA二级强化班-财务报表分析-演示习题

READING21IntercorporateInvestment:Q&A1-6(原书BOOK-2P55Question1-6)ThefollowinginformationrelatestoQuestions1—6Cinnamon,Inc.isadiversifiedmanufacturingcompanyheadquarteredintheUnitedStates,anditcomplieswithU.S.CAAP.In2008,Cinnamonhelda19percentpassivestakeinCambridgeProcessingthatwasclassifiedasavailable-for-sale.Duringtheyear,thevalueofthisstakeroseby$2million.InDecember2008,Cinnamonannouncedthatitwouldbeincreasingitsownershipto50percenteffective1January2009.PeterLubbock,ananalystfollowingbothCinnamonandCambridge,iscurioushowtheincreasedstakewillaffectCinnamon’sconsolidatedfinancialstatements.HeasksCinnamon’sCFOhowthecompanywillaccountforthestake,andistoldthatthedecisionhasnotyetbeenmade.Lubbockdecidestousehisexistingforecastsforbothcompanies’financialstatementstocomparevariousalternativeoutcomes.LubbockgathersabbreviatedfinancialstatementdataforCinnamon(Exhibit1)andCambridge(Exhibit2)forthispurpose.Exhibit1SelectedFinancialStatementEstimatesforCinnamon,Inc.($Millions)YearEnding31December20082009Revenue$1,400$1,575Operatingincome126142Netincome626931December20082009Totalassets1,1701,317Shareholders’equity616685Exhibit2SelectedFinancialStatementEstimatesforCambridgeprocessing($Millions)YearEnding31December20082009Revenue$1,000$1,100Operatingincome8088Netincome4044Dividendspaid202231December20082009Totalassets800836Shareholders’equity4404621.In2008,Cinnamon’searningsbeforetaxesincludesacontribution(in$millions)fromitsinvestmentinCambridgeProcessingclosesttoA.$2.5million.B.$3.8million.C.$5.0million.Biscorrect.Dividendsfromequitysecuritiesthatareclassifiedasavailable-for-saleareincludedinincomewhenearned.Cinnamonwouldrecordits19percentshareofthedividendspaidbyCambridge,whichamountedto$3.8million.ThoughthevalueofCinnamon’sstakeinCambridgeProcessingroseby$2millionduringtheyear,underU.S.GAAPanyunrealizedgainsorlossesforavailable-for-salesecuritiesarereportedintheequitysectionofthebalancesheetaspartofothercomprehensiveincomeuntilthesecuritiesaresold.2.In2009,Cinnamonisleastlikely)toaccountforitsinvestmentinCambridgeunderwhichofthefollowingmethods?A.Equity.B.Purchasemethod.C.Proportionateconsolidation.Ciscorrect.IfweknewwhetherCinnamonhadcontrollinginterestorjustsignificantinfluence,wecouldthendeterminewhethertheequitymethodorthepurchasemethodwouldbemorelikelyU.S.GAAPdoesnotallowtheproportionateconsolidationmethodexceptincertaincases(andneverwhenthereportingcompanyisincorporated,asisCinnamon).3.At31December2009,Cinnamon’sshareholders’equityamountonthebalancesheetwouldmostlikelybeA.highestifCinnamonisdeemedtohavecontrolofCambridge.B.independentoftheaccountingmethodusedfortheinvestmentinCambridge.C.highestifCinnamonisdeemedtohavesignificantinfluenceoverCambridge.Biscorrect.Netassets(shareholders’equity)isnotaffectedbythechoiceofaccountingmethodforactiveinvestmentsinotherentities.4.In2009,Cinnamon’snetprofitmarginwouldbehighestifA.itisdeemedtohavecontrolofCambridge.B.ithadnotincreaseditsstakeinCambridge.C.itisdeemedtohavesignificantinfluenceoverCambridge.Ciscorrect.IfCinnamonisdeemedtohavesignificantinfluence,itwouldreportundertheequitymethodnoneofCambridge’srevenuebuthalfofitsnetincome($20).ItsprofitmarginwouldthenbehigherthanifitalsoreportedhalfofCambridge’srevenue(controlwhichimpliesconsolidationmethod)orifitonlyreported19percentofCambridge’sdividends(nochangeinownership).5.At31December2009,Cinnamon’sreporteddebt-to-equityratiowillmostlikelybehighestifitisdeemedtohaveA.controlofCambridge.B.jointcontrolofCambridge.C.significantinfluenceoverCambridge.Aiscorrect.Ifcontrolisassumed,Cinnamonwouldconsolidate100percentofCambridge’sdebt,butunderUS.GAAPitwouldnetoutthe50percentminorityinteresttoarriveatshareholders’equity.Itislikelythatthedebt/equityratiowouldbehigherif100percentofCambridge’sdebtbutonlyhalfofitsequitywereincludedonCinnamon’sfinancialstatements.6.ComparedtoCinnamon’soperatingmarginin2008,ifitisdeemedtohavecontrolofCambridge,itsoperatingmarginin2009willmostlikelybeA.lower.B.higher.C.thesame.Aiscorrect.Cambridgehasaloweroperatingmargin(88/1,100=8.0%)thanCinnamon(142/1,575=9.0%).IfCambridge’sresultsareconsolidatedwithCinnamon’s,theconsolidatedoperatingmarginwillreflectthatofthecombinedcompany,or230/2,675=8.6%.Q&A7-12(原书BOOK-2P56Question7-12)ThefollowinginformationrelatestoQuestions7—12Zimt,AGisaconsumerproductsmanufacturerheadquarteredinAustria.ItcomplieswithIFRS.In2008,Zimthelda10percentpassivestakeinOxbowLimitedthatwasclassifiedasheld-for-tradingsecurities.Duringtheyear,thevalueofthisstakedeclinedby€3million.InDecember2008,Zimtannouncedthatitwouldbeincreasingitsownershipto50percenteffective1January2009.FranzGelblum,ananalystfollowingbothZirntandOxbow,iscurioushowtheincreasedstakewillaffectZimt’sconsolidatedfinancialstatements.BecauseGelblumisuncertainhowthecompanywillaccountfortheincreasedstake,heuseshisexistingforecastsforbothcompanies’financialstatementstocomparevariousalternativeoutcomes.GelblumgathersabbreviatedfinancialstatementdataforZimt(Exhibit1)andOxbow(Exhibit2)forthispurpose.Exhibit1SelectedFinancialS