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ACC 620 Milestone Three Guidelines and Rubric Prompt: In the second milestone, you addressed income taxes and pensions for your portfolio. In the third and final milestone, you will add leases and the...

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ACC 620 Milestone Three Guidelines and Ru
ic

Prompt: In the second milestone, you addressed income taxes and pensions for your portfolio. In the third and final milestone, you will add leases and the
statement of changes to your portfolio.

IV. Leases
A. What are the differences between operating and capital leases?
B. Describe the particular leases of your company based on the liability section of your company’s balance sheet.
C. What impact have the leases had on the company’s financial statements for the most recent year?
D. Discuss the advantages and disadvantages of leasing a building versus purchasing one.

VI. Statement of Cash Flows
A. From the perspective of an investor, determine whether or not you would invest in your chosen company based on the company’s statement of
cash flows (SoCF). Support your opinion.
B. Review the company’s SoCF for any concerns that may need to be addressed. As controller of your company, prepare a memo to your CEO,
giving a summary report for possible recommendations.

Guidelines for Submission: Your paper must be submitted as a 2–3-page Microsoft Word document with double spacing, 12-point Times New Roman font, one-
inch margins, and at least three sources cited in APA format.

Critical Elements Exemplary (100%) Proficient (90%) Needs Improvement (70%) Not Evident (0%) Value
Leases: Operating
and Capital
Meets “Proficient” criteria, and
description is exceptionally
clear and contextualized
Comprehensively describes the
differences between operating
and capital leases
Describes the differences
etween operating and capital
leases, but description is
cursory or lacks detail
Does not describe the
differences between operating
and capital leases
16
Leases: Particular Meets “Proficient” criteria, and
description is exceptionally
clear and contextualized
Describes the particular leases
of the company based on the
liability section of the
company’s balance sheet
Describes the particular leases
of the company, but does not
ase description on the liability
section of the company’s
alance sheet
Does not describe the
particular leases of the
company
15
Leases: Impact Meets “Proficient” criteria, and
defense is well supported with
concrete examples
Comprehensively discusses the
impact the leases had on the
company’s financial statements
for the most recent year
Discusses the impact the leases
had on the company’s financial
statements for the most recent
year, but discussion is cursory
or lacks detail
Does not discuss the impact
the leases had on the
company’s financial statements
15
Critical Elements Exemplary (100%) Proficient (90%) Needs Improvement (70%) Not Evident (0%) Value
Leases: Building Meets “Proficient” criteria and
uses concrete examples to
illustrate claims
Comprehensively discusses the
advantages and disadvantages
of leasing a building versus
purchasing one
Discusses the advantages and
disadvantages of leasing a
uilding versus purchasing one,
ut discussion is cursory or
lacks detail
Does not discuss the
advantages and disadvantages
of leasing a building versus
purchasing one
15
Statement of Cash
Flows: Invest
Meets “Proficient” criteria, and
opinion is well supported with
concrete examples
Determines whether or not to
invest in the company based on
the SoCF and supports opinion
Determines whether or not to
invest in the company based on
the SoCF, but does not support
opinion, or support for opinion
is weak or illogical
Does not determine whether or
not to invest in the company
16
Statement of Cash
Flows:
Recommendations
Meets “Proficient” criteria, and
ecommendations are well
supported and logical
Composes a memo to the CEO
making recommendations that
would effectively resolve any
concerns identified in the SoCF
Composes a memo to the CEO
making recommendations to
address concerns identified in
the SoCF, but
ecommendations would not
effectively resolve concerns
Does not compose a memo to
the CEO
15
Articulation of
Response
Submission is free of e
ors
elated to citations, grammar,
spelling, syntax, and
organization and is presented
in a professional and easy-to-
ead format
Submission has no major e
ors
elated to citations, grammar,
spelling, syntax, or organization
Submission has major e
ors
elated to citations, grammar,
spelling, syntax, or organization
that negatively impact
eadability and articulation of
main ideas
Submission has critical e
ors
elated to citations, grammar,
spelling, syntax, or organization
that prevent understanding of
ideas
8
Total 100%
Answered Same Day Apr 18, 2021

Solution

Khushboo answered on Apr 25 2021
151 Votes
LEASES AND CASH FLOW STATEMENT
LEASES AND CASH FLOW STATEMENT        4
FROM: KHUSHBOO MURARKA
DATE: 21/04/2019
SUBJECT: LEASES AND CASH FLOW STATEMENT
Part 1: Leases:
A. Difference between capital lease and operating leases:
The major differences between operating lease and capital lease are as below:
    Criteria
    Operating lease
    Capital lease
    Lease term
    The term of the lease is less than 75% of total economic life of leased asset.
    The term of lease is either equal to or more than 75% of the total economic life of leased asset.
    Ownership option
    Ownership always remained with the lessor after the expiry of lease period.
    Ownership may be transfe
ed to lessee after the expiry of lease period.
    Present value of asset
    The present value of the lease payments should be less than 90% of the cost of assets.
    The present value of lease payments should be equal or greater than 90% of the cost of assets.
    Accounting treatment
    Payments are considered in statement of profit and loss as expense.
    Leased equipment is considered as asset and payments are considered as liability.
B. Analysis of leases of Amazon Inc.:
In case of Amazon Inc. the company has recognized the lease either operating or capital since the inception of lease term and is recognizing the lease cost on straight-line basis without considering the defe
ed terms of the payment. Further, the company has reduced incentives from the cost of leased assets over the period of lease. The company is having such lease a
angements under which the company has created assets and liabilities for the estimated construction costs to the level which the company is in line of constructing the structural improvements or took risk related to construction prior to commencement of lease. The company has...
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