Company Case #2 Noncurrent (Long-Term) Liabilities Answer these questions based on the DELL INC Form 10-K that

is included in the Cases and Discussion Memos Folder on Blackboard. The financial statements begin on page 59, which is shown as the number at the bottom of each page and continue through page 107. The following questions ask about information in the financial statements. While the company may discuss or disclose similar information elsewhere in the filing, in responding to the questions I am only looking for information or disclosures made in the financial statements themselves, i.e., pages 59-107 of the filing. (Note: to receive full credit you must answer all parts of each question, even if you believe you have provided the answer in response to an earlier question or earlier part of the question.) 1. 2. For noncurrent (long-term) liabilities, what categories of long-term liabilities does the company disclose on the balance sheet and what are their amounts for the most recent year? What does the accounting policy footnote (Summary of Significant Accounting Policies-usually Note 1 or Note A) have to say, if anything, about any category of long-term liabilities? (This question is asking for disclosures only made in the accounting policy footnote-not those made in any other footnote or elsewhere in the filing.) (a) Identify by number and title any footnote(s) besides the accounting policy footnote that address(es) long term or noncurrent debt (by which is meant only notes payable, credit facilities, or bonds payable or capital leases, if any). (b) For long term or noncurrent debt identify in a general manner what information is provided for each debt instrument? (c)Why do you think investors or creditors would find this information useful? (a) Identify by number (or letter) and title any footnote(s) besides the accounting policy footnote that address other types of long-term liabilities (besides notes payable, credit facilities, bonds or capital leases, if any). (b) Identify in a general manner what information is provided for each such other longterm liability. (a) Compute the companys liabilities to total assets ratio (total liabilities divided by total assets) for the current and prior year. (b) What do you think this ratio indicates about the companys financial stability? That is, do you think the company is a good credit risk?

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Codification Question Find the section in the FASBs Accounting Standards Codification that provides the guidance on the accounting for liability extinguishments, which means the guidance on when a liability can be derecognized, that is removed from the companys books. The appropriate paragraphs can be found using the search function or by looking at the broad area of Liabilities, then clicking on the Topic Liabilities, then clicking on the appropriate Subtopic (it is obvious), then clicking on Derecognition. Once there, copy the two paragraphs that directly address derecognition into your response and indicate clearly the specific codification code sections that these paragraphs are from. Then very briefly explain what you think these paragraphs are saying. For academic access to the FASB Codification database through the American Accounting Association, you may log in at the following website: http://aaahq.org/ascLogin.cfm using the following login information: STUDENTS: User ID AAA51855 Password sJTh4TD Note: Failing to answer the codification question will result in a loss of 2.5 of 10 points, no matter how well the rest of the case was prepared.