review the most current 10K filing at Coca-Cola Company’s All SEC Filings (Links to an external site.) webpage.
Write: Make sure your response addressing the following questions is more than 200 words, and that you include a brief paraphrase or direct quote from the reading material where appropriate. Include proper in-text citations for each paraphrase or direct quote, as shown in the UAGC Writing Center’s Citing Within Your Paper (Links to an external site.) guide.
Access the most current 10K Coca-Cola Company’s SEC 10K filing at All SEC Filings (Links to an external site.) webpage, and address the following questions:
- What companies do Coca-Cola describe as significant equity method investments? How do these investments help Coca-Cola?
- What criteria does Coca-Cola use in choosing to apply the equity method for these investments?
- How does Coca-Cola describe its application of the equity method?
- What amount of equity income did Coca-Cola report?
Coca-Cola discloses the fair values of its publicly traded bottlers accounted for as equity method investments. List the book values and fair values for these equity method investments that have publicly traded securities. Discuss the relevance of each of these two values. 300 words
Ahorita Company manufactures wireless transponders for satellite applications. Ahorita has recently acquired Zelltech Company, which is primarily known for its software communications development, but also manufactures a specialty transponder under the trade name “Z-Tech” that competes with one of Ahorita’s products. Ahorita will now discontinue Z-Tech and projects that its own product line will see a market share increase. Nonetheless, Ahorita’s management will maintain the rights to the Z-Tech trade name as a defensive intangible asset to prevent its use by competitors, despite the fact that its highest and best use would be to sell the trade name. Ahorita estimates that the trade name has an internal value of $1.5 million, but if sold would yield $2 million.
Answer the following with supporting citations from the FASB Accounting Standards Codification (ASC):
- How does the FASB ASC Glossary define a defensive intangible asset?
- According to ASC Topic 805, “Business Combinations,” what is the measurement principle that an acquirer should follow in recording identifiable assets acquired in a business combination?
- According to ASC Topic 820, “Fair Value Measurement,” what value premise (in-use or in-exchange) should Ahorita assign to the Z-Tech trade name in its consolidated financial statements?
- According to ASC Topic 350, “General Intangibles Other Than Goodwill,” how should Ahorita determine the estimated useful life of its defensive intangible asset. 300 words