Essay on Group Project - Dorel Industries

2367 Words Mar 26th, 2013 10 Pages
COMM 217 FINANCIAL ACCOUNTING
FALL 2012
Section (lecture): B
Group Project Part 2 (of 2)
Dorel Inc.

Presented to:
Prof. George Kanaan

Date: November 22nd 2012
John Molson School of Business – Concordia University

$ = thousands of U.S. dollars
Chapter 8
8.1
Cost of Sales Equation = Beginning Inventory + Purchases - Ending Inventory
1 846 470 000 = 510 068 000 + 177 811 000 - 442 409 000
Purchases for the year 2011 total $65 812 530.
8.2
Dorel calculates costs of inventory with the use of a First in, First Out (FIFO) system. The reason for choosing the FIFO inventory cost system could be due to the fact that managers at Dorel like to report higher earnings for their company. In the case for FIFO, since it
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No long-lived assets were sold in 2010, and neither in 2009 Chapter 10
10.1
a) | 2011 | 2010 | 2009 | Bank Indebtedness | 20 130 000(2.3%) | 30 515 000 (3.5%) | 1 987 000 (0.2%) | Trade and Other Payables | 323 552 000(37.3%) | 323 588 (36.7%) | 291 932 000 (33.8%) | Other financial Liabilities | 13 650 00(1.5%) | 4 203 000 (0.5%) | 1 185 000 (0.1%) | Long-term debt | 2 315 000 (0.2%) | 13 154 000 (1.5%) | 27 257 000 (3.2%) | Provision | 37 096 000 (4.3%) | 43 232 000 (4.9%) | 46 482 000 (5.4%) | Total Liabilities | 866 914 000 | 880 840 000 | 864 270 000 |

b) Our results suggest the following: * Bank Indebtedness first increased from 2009 to 2010, and then fell from 3.5% (2010) to 2.3% (2011). * Trade and other payables, as well as other financial liabilities have seen an increase over the past 3 years with a range of 3.5% separating 2011 and 2009. * Long-term debts and provisions experienced a decline over the span of 3 years starting with 2009.
10.2
“The breadth of the Company’s operations and the global complexity of tax regulations require assessments of uncertainties and judgments in estimating the ultimate taxes the Company will pay. The final taxes paid are dependent upon many factors, including negotiations with

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