Antle Chapterf.pptx-Antle Chapter • Book...
Antle_Chapterf.pptx-Antle Chapter • Book, economic and
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Antle Chapterf.pptx-Antle Chapter • Book, economic...
Antle_Chapterf.pptx-Antle Chapter • Book, economic and
Antle Chapterf.pptx-Antle Chapter •...
Antle_Chapterf.pptx-Antle Chapter • Book, economic and
Page 14
Intangible Assets
Research and development
Brand names (popular products)
Product quality
Customer loyalty
Human capital (training is an expense)
Valuable contracts and business links
Producon processes
Monopoly power
Future expansion opons

Page 15
Liabilies on Balance Sheet
Liabilies can be reported as zero, at
historical cost or fair value
Historical cost can be based on present value
of payments
If done accurately, those will inially match
economic value

Page 16
Liabilies on Balance Sheet (cont.)
Value of current liabilies is typically close to economic value
Discounng is not an issue
Generally involve no esmates
Firm will sasfy the liabilies
Value of bonds on balance sheet reflects value at issuance
date adjusted for amorzaon of the bond premium or
Not equal to market value
Firms disclose the fair value of their debt in their debt footnote
Value recorded on balance sheet for pension and OPEB
liabilies depends on assumpons made

Page 17
Liabilies on Balance Sheet (cont.)
Lawsuit outcomes and other conngencies
typically not recorded at all
Footnote disclosure is required for possible conngent
Only record in balance sheet if it is probable and can
esmate the amount to be paid
No liability recorded for stock opons (even aſter
rule change that recognized opon expense)
Mutually unexecuted contracts are not recorded

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