Tag Archives: inventory

What could a Logitech staff accountant have done if he/she knew that the CFO and controller failed to write down the discontinued Revue parts inventory?

In the fourth quarter of 2010, Logitech International released the Revue, a TV set-top box designed to integrate cable/satellite TV with internet content. The Revue Google search bar would be able to find any desired content from any provider and project that content to the TV screen. The Revue was manufactured by contract manufacturers, not […]

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What does The Cheesecake Factory’s inventory include and where is it located on its financial statements?

The Cheesecake Factory Incorporated (NASDAQ: CAKE) operates over 200 restaurants and two bakeries in the United States. In its two bakeries, it bakes and prepares more than 70 desserts, both for its own use in its restaurants and for sale to a wide variety of wholesalers and retailers. The Cheesecake Factory’s inventories consist of restaurant […]

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What is the impact on Abercrombie & Fitch’s financial statements from the write-down of its logo-adorned merchandise inventory?

Recently, Abercrombie & Fitch (NYSE: ANF) has been implementing a turnaround strategy since its sales had been falling for the past few years (11% decrease in 2014, 8% in 2015, and just 3% in 2016.) One part of Abercrombie’s new strategy has been to abandon its logo-adorned merchandise, replacing it with a subtler look. Abercrombie […]

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How could the different inventory costing methods used by Best Buy, Amazon, and Target impact their respective income statements and balance sheets?

Three retailing giants, Best Buy Co., Inc. (NYSE: BBY), Amazon.com, Inc., (NASDAQ: AMZN), and Target Corporation (NYSE: TGT) each use a different inventory costing method. Best Buy uses weighted-average cost, Amazon uses FIFO, and Target uses LIFO. Here is a hypothetical example that highlights the potential differences in income statements and balance sheets that could […]

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Are the articles of secondhand clothing offered for sale on thredUP’s online store included in inventory on thredUP’s balance sheet?

ThredUP is a startup online consignment and thrift store. Consumers can buy like-new, carefully vetted brand-name clothing from thredUP’s online store at discounts of up to 80% off of the original retail prices. Consumers can also send in their unwanted clothing articles for thredUP to resell.  ThredUP’s professional buyers go through the articles of clothing […]

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What does Home Depot’s 2015 Form 10-K communicate about its inventory?

Home Depot (HD) is a retailer of home improvement and construction products. Home Depot is currently the world’s largest home improvement retailer with revenues exceeding $83 billion in its fiscal year ending February 1, 2015. The most commonly used inventory valuation methods are first-in first-out, last-in first-out, and average or weighted average cost. See the […]

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Should the original cost of the leftover 10 million pounds of Mighty Wings matter to McDonald’s decision makers?

In the first half of 2013, McDonald’s bought and stockpiled about 50 million frozen chicken wings for a promotion it was planning for fall 2013. In the fall 2013, McDonald’s debuted Mighty Wings, a menu item that would be available only through the end of November 2013. When Mighty Wings came out, McDonald’s did not […]

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