Wednesday, October 29, 2008

Chapter 15 Long Term Liabilities

What is an Annuity?
The annuity is a series of identical cash payments to be received at fixed intervals.

What is a Bond?

The bond is a certificate of debt which bears interest for a long period of time.

What is a Bearer Bond?

A bearer bond is a bond that is not registered.

What is a Bond Indenture?
The bond indenture is the contract between a corporation issuing bonds and the bondholders. The indenture contains the face value of the bond, the contract interest rate, and the maturity date.

What is a Callable Bond?

A Callable bond is a bond subject to retirement at a stated dollar amount prior to maturity, at the option of the issuer.

What is Capital Lease?

A capital lease is a contractual arrangement that transfers substantially all the benefits and risks of ownership to the lessee, so that the lease is in effect a purchase of the property.

What is Carrying Amount?
The carrying amount is the balance of the bonds payable account (face amount of the bonds) less any unamortized discount or plus any unamortized premium.

What is a Contract Rate or Contractual Rate?
The contract rate is the periodic interest to be paid on the bonds that is identified in the bond indenture; it is expressed as a percentage of the face amount of the bond (e.g., 97, 98, and 104). Other names for contract rate are “coupon rate” and “stated rate.”

What is a Debenture Bond?
A debenture bond is an unsecured bond issued based on the excellent reputation of the issuer. Therefore, the bond issue doesn’t require the pledge of assets, treasury stock, or any other type of collateral.

What is a Discount?
The discount is the interest deducted from the maturity value of a note or the excess of the face amount of bonds over their issue price.

What is an Effective Interest Rate Method?
The effective interest rate method is the method of amortizing discounts and premiums that provides for a constant rate of interest on the carrying amount of the bonds at the beginning of each period; often called simply the “interest method.”

What is Face Value?

Face value is the amount of principal the issuer must pay at the maturity date of the bond.

What is Future Value?

The future value is the estimated worth in the future of an amount of cash on hand today invested at a fixed rate of interest.

What is Market Interest Rate?
The market interest rate is the rate investors demand for loaning funds to the corporation. The rate is fixed by the for forces of demand supply.

What is Operating Lease?

An operating lease is a contractual agreement that gives the lessee the right to use property (which belongs to the lessor) for a period of time. The title to the property remains with the lessor.

What is Premium?

The premium is the excess of the issue price of a stock over its par value or the excess of the issue price of bonds over their face amount.

What is Present Value?
The present value is the estimated worth today of an amount of cash to be received (or paid) in the future.

What is Present Value of an Annuity?
The present value of an annuity is the sum of the present values of a series of equal cash flows to be received at fixed intervals.

What is a Sinking Fund?
The sinking fund is a fund in which cash or assets are set aside for the purpose of paying the face amount of the bonds at maturity.

What is a Perpetuity?

A perpetuity is a bond that is issued without a maturity date.

Ch1 Accounting in Action

Ch2 Recording Process

Ch3 Adjusting the Accounts

Ch4 Completing the Accounting Cycle

Ch5 Merchandising Operations

Ch6 Inventories

Ch7 Accounting Information Systems

Ch8 Internal Control and Cash

Ch9 Accounting for Receivables

Ch10 PP&E, Natural Resources, and Intangible Assets

Ch11 Current Liabilities and Payroll


Ch12 Partnerships

Ch13 Corporations

Ch14 Corporations:Dividends, RE

Ch15 Long Term Liabilities

Ch16 Investment

Ch17 Statement of Cash Flows

Ch18 Financial Statement Analysis

Plato and Accounting

Price/Earnings Ratio

Plant Assets

Luca Pacioli and DaVinci


The secrets of 'no-doze' prose:
Mary Duffy's Sentence Openers






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Friday, October 17, 2008

Mike Barnicle: Misogynist - Was He Hatched by an Ostrich or a Reptile?

Nothing can be more insulting than a man who insults women.

If you ever want to see the image of a misogynist, just look at the picture of Mike Barnicle. Not only does he hate women, but he'd like to see them disappear from the face of the earth. Which makes me wonder if he was born of a woman, or a reptile--or even a mule.

Why would someone like Joe Scarborough allow Barnicle pollute the airwaves with the hate-speech of a man like Barnicle? Is it that hate-speech brings ratings? I can understand this man writing for the Huffington Blog --which is hate dump-- but on TV? That is too much for me. So, whenever he's a guest in Morning Joe, I simply switch channels.

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Monday, October 13, 2008

Paul Krugman: While He Wins Nobel Prize, the USA Languishes as a Result of His Theory

Americans will not rejoyce in Krugman winning the Nobel Prize for Economics.

The closing of factories in the USA and loss of jobs are the direct result of Krugman's theory:
Produce overseas where is cheap and take advantage of economies of scale! Yes, indeed--we can see the results now.

As many greedy industrialists followed his advice, factories and jobs started to disappear in the USA. First came "outsourcing" and then "downsizing."

Lord Keynes once said, "In the long run we are all dead." And that's exactly what the enemies --anarchists, leftists, socialists, and communists-- of the USA are wishing: the death of a great industrial nation. But do not bet against the resilience of the people in this great country.

What is most disturbing to me is that Krugman is now giving advice on solving the financial crisis. Follow England's model he says. In other words: "Let's have socialism!"

I wonder if the New York Times will throw a party for him.

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Saturday, October 11, 2008

Rachel Maddow: Marxist Dialectics in Action

To think that Marxist dialectics is still being practiced in America boggles the mind. And on TV, to boot! To hear liberal academicians still spew thesis, antithesis, and synthesis isn't so bad, but to hear such gibberish from a TV commentator in the 21st Century is baffling. Are we regressing?

Let me give you a paragraph of history:

Marx (using Hegel’s dialectics) attempted to discard the system of binary opposites. He attempted to replace it with a more universal triad of concepts: thesis, antithesis, and synthesis. The result was the now defunct Dialectic Materialism (thesis: the feudal class system; antithesis: the bourgeois class; synthesis: the proletariat). If you oppose two ideas, out of the clash a new one is born--supposedly.

More than 125 years later (after Marx's death) Rachel Maddow has resurrected the very same Marxist method of argument. When Hurricaine Ike was devastating Galveston and Huston, Rachel's political commentary was mirroring the natural disaster: thesis--water, antithesis--electricity, synthesis--McCain suspends Republican convention. Were this form of corrupted marxian dialectics not laughable, it would be dangerous.

Who had the insulting, if not dangerous idea, to put this woman to analyze American politics with "Dialectic Materialism" tools? Well, as long as she gets the ratings I supposed CNBC will be safe. But why not say what she is--an avowed Marxist? Is it too much to ask for honesty and full disclosure in the airwaves (radio and tv)?

Tune in and try to detect her marxist techniques. Once you get it you will understand why she is such a passionate advocate of Senator Obama: Obama--the most liberal senator--is as close to marxism as two coats of paint (pink and red). Might I remind readers that "Black Liberation Theology" is an offshoot of Marxist Liberation Theology as preached and published by the Jesuit priest Gustavo Gutierrez, in the 1960s.

When in the late 1960s Louis Althusser's "Structuralist Marxism" fell flat and stiff on its back (as if in a casket), I thought that was the last marxist gasp. Is another incarnation of such discredited and convicted ideology needed? Apparently Rachel Maddow thinks so, and so does CSNBC.

That she is a lesbian, I accept, just like millions of Americans do. But that she is a Marxist? To attempt to revive an extinct ideology that was the vehicle for the likes of Stalin and Lenin to slaughter forty million human beings, is morally reprehensible.

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Thursday, October 9, 2008

Ch.14 Corporations: Dividends, Retained Earnings, and Income Reporting

What is Cash Dividend?
A cash dividend is a pro-rata distribution of profits in the form of cash (from retained earnings) to stockholders.

What is Declaration Date?
Declaration date is the date on which the board of directors formally declares dividends and announces it to stockholders.

What is Deficit?
Deficit is a debit balance in retained earnings.

What is Dividend?
Dividend is a distribution of profits (net income) in the form of cash, stock, script, or properties or merchandise.

Earnings Per Share (of Common Stock)
EPS is a measure of profitability which shows the amount of net income earned by each share of outstanding common stock. This measure is used in computing the Price/Earnings ratio.

Liquidating Dividend
A liquidating dividend is a dividend declared out of Paid-in-Capital.

Payment Date
Payment date is the date on which checks are mailed to stockholders.

Prior Period Adjustment
Prior period adjustments are the correction of financial statements for errors that happened in previous accounting years.

Record Date
Record date is the date when ownership of outstanding shares is determined for dividends purposes.

Retained Earnings
Retained earnings is the shareholders’ equity account into which the net income is transferred from the Income Summary. The normal balance of retained earnings is credit.

What is a Merger?
Merger is the joining of two corporations in which one company acquires all the assets and liabilities of another corporation, which is then dissolved.

What is Minority Interest?
Minority interest is the portion of a subsidiary corporation’s stock owned by outsiders.

What is ‘Parent Company’?
A parent company is a corporation owning all or a majority of the voting stock of the other corporation. (576)

What is P/E Ratio—Price-Earnings Ratio?
The Price-Earnings ratio is the ratio computed by dividing a corporation’s stock market price per share at a specific date by the company’s annual earnings per share (EPS).

What is Subsidiary Company?
A subsidiary company is a corporation that is controlled by a parent company.

What is Taxable Income?
Taxable income is the income according to the tax laws that is used as a base for determining the amount of taxes owed.

What are Temporary Differences?
Temporary differences are differences between taxable income and income before income taxes (IBIT). The differences are created because items are recognized in one period for tax purposes and in another period for income statement purposes. Such differences reverse or turn around in later years.

What are Temporary Investments?
‘Temporary investments’ is the balance sheet caption used to report investments in income-yielding securities that can be quickly sold and converted to cash as needed.

What is Trading Securities?
Trading securities are securities that management intends to actively trade for profit.

What is Unrealized Gain or Loss?
Unrealized gain or loss is the difference between the fair market value of the securities and their cost.

Ch1 Accounting in Action

Ch2 Recording Process

Ch3 Adjusting the Accounts

Ch4 Completing the Accounting Cycle

Ch5 Merchandising Operations

Ch6 Inventories

Ch7 Accounting Information Systems

Ch8 Internal Control and Cash

Ch9 Accounting for Receivables

Ch10 PP&E, Natural Resources, and Intangible Assets

Ch11 Current Liabilities and Payroll


Ch12 Partnerships

Ch13 Corporations

Ch14 Corporations:Dividends, RE

Ch15 Long Term Liabilities

Ch16 Investment

Ch17 Statement of Cash Flows

Ch18 Financial Statement Analysis

Plato and Accounting

Price/Earnings Ratio

Plant Assets

Luca Pacioli and DaVinci


The secrets of 'no-doze' prose:
Mary Duffy's Sentence Openers






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