Acc 306 Week 2 Dq 2 Ethics Case 15 4 Ash Course

AMC Theatres has been an innovator in the movie theater business for more than 50 years. The chain presents one-of-a-kind specials and film offerings in state-of-the-art theater accommodations. Over the years, the chain has acquired numerous other chains, as well as acquired themselves by a large Chinese company, in turn giving the chain more than 663 theaters across the United States and China. Here are 9 interesting facts about AMC Theatres.

* Accumulation of costs exceeds the amount expected for acquisition or construction of the asset

Using the data for 2013, determine the average useful life of Everett 's non-current assets

their lifetime. A car is a depreciating asset, it loses value rapidly and drastically. Despite a car

The way that they record depreciation and amortization is by using the straight-line method over the shorter of the estimated useful lives of their assets or the terms of the respective leases. As we have learned, straight-line method is one of the types of ways that a company can depreciate their assets. This method considers depreciation as a “function of time rather than a function of usage.” Because this method is known to be one of the simplest, many companies often use it, including Toys “R” Us. The straight-line procedure is also often considered to be the most conceptually appropriate. The straight-line method often results in a major objection because it rests on two tenuous assumptions. The two include: The asset's economic usefulness is the same each year, and the maintenance and repair expense is essentially the same each period. Another problem that arises from using the straight-line method is that distortions in the rate of return analysis (income/assets)

By mid 2002, the company had 349 screens in 31 locations and had generated a reported compound annual rate of return well in excess of 20% for its initial investors. 2-for-1 Wednesdays In the spring of 2001, Cinemex’s competitors began offering a special deal: any customer who purchased a ticket to see a film on a Wednesday (traditionally a slow day at the box office) would receive a second ticket at no additional charge. This ploy cut into Cinemex’s attendance figures (Exhibit 3). On five of the first six Wednesdays after the deal’s introduction, Cinemex’s attendance was less than in the same week during the previous year. Heyman faced a difficult decision. Should he offer his own two-for-one deal on Wednesdays? This might raise attendance, but since many tickets would be given away for free, it might also reduce ticket revenues. Or should he do nothing, hoping that the appeal of Cinemex’s customer service package would eventually bring customers back? Heyman’s first step was to review his attendance data. What made this difficult was that week-to-week attendance was highly variable, depending on (among other things) the time of year, the popularity of current films, local weather conditions, and the timing of holidays. The question was how to disentangle the impact of these factors from those of Wednesdays at Cinemex Page 2

“The growth in General and Administrative expenses is due to increases prototype expenses, increases personnel and related salary and benefit costs to support our expansion, and other cost increases necessitated by the growth of the company.”¹

This project was last updated on May 19, 2015 and its estimated completion is fourth quarter of 2015. Almost every single organization gets involved in leasing activities; therefore accounting for leases is important. However, the current models have been criticized because by using the models faithful representation of leasing transactions is not always presented and therefore these models cannot meet the needs of financial statements users. The existing accounting guidance of leases does not require many lessees to recognize lease assets and liabilities. While many users and stakeholders request the change of making lessees recognize lease assets and lease liabilities, the project aimed at improve comparability and transparency among organizations by requiring the recognition and disclosure of information (“Leases,” 2015). On the last meeting, the Boards have reached several decisions, which are updated in “Lease” (2015). First, collectability is taken into account the lessor accounting. If control of asset under lease is not transferred to lessee and collectability of payments is not probable, then the lease should be classified as Type B lease. On the other hand, if control of asset under lease is transferred to lessee, then the lease should be assessed for collectability. Second, the Board modified the Type A lease. This modification affects the discount rate and so the initial net investment. The decision regarding the impairment of Type A lease assets requires lessor to assess receivable and unguaranteed residual asset for impairment. Besides, the Board no longer allows gain or loss for differences between purchase price and carrying amount of the lease liability, if the lease asset is purchased. As of the date, tentative decisions are basically related to six parts, including accounting models, scope, measurement, presentation, disclosure, and nonpublic

This transformation is demonstrated by the number of theater screens with recognized international standards, and the enormous revenue earned by movie theaters daily. While there are great potentials to further develop, the current local cinema market is facing several major problems.

The company has interesting attributes that bolster their mission to create “smiles”. AMC was the first movie theatre chain to include stadium seating, able to fit more customers comfortably. In addition to this, they were the original theatre chain to incorporate options into their theatres. AMC’s founder, Stanley Durwood, is responsible for kickstarting the multiplex theatre industry. He felt AMC ‘s customers were at a disadvantage with just one theatre. He began renovating theatres to have several auditoriums, rather than one major one. When the idea proved to be

Along with investment in capacity increases, we also planned to spend a large portion on marketing to our prospective customers, thus protecting our position again from competition. We spent a total of $115,717 on marketing. We thought that this was going to be high in comparison to the other organizations; however, in reviewing the other organizations financial figures we can see that we were actually one of the organizations that spent the least on marketing (it in the end did not drastically affect us, because out of all the sections we still finished second, despite our low spending on marketing).

The corporation ‘Film 2011’ is specialised in the entertainment industry and provide cinema halls. The directors’ are interested in expansion of this business UK wide chain of cinemas. For this 3 cinema chains A, B, C are assessed for their performance and a random sample of 128 cinemas in England, Scotland and Wales was selected. Chain A specially provide pass for 4-8 weeks. The director’s claim was that the average total monthly sale of all cinemas is approximately £285,000. He was also interested in any other useful information which will help in expansion and increase in sale of corporation ‘Film 2011’. So, our main objectives are:

Over the past few years the film rental market underwent a major shift. The in-store rental market plummeted by nearly $2 million, while vending machine rentals increased by about ten times the amount and by-mail rentals nearly doubled. However, Video On Demand (VOD) services obtained through cable, digital, and subscription also saw even larger increases. All of these changes meant companies like Blockbuster and Hollywood Video had to either restructure and make a complete business model shift- or face bankruptcy. Meanwhile, the increases for by-mail rentals and VOD subscription, both of which services

2. Sacrificing long term relationships with theater-goers for the increase in short term profitability (commercials, etc…)

Also, can these methods be done without making pricing for the theater experience too unappealing to lower-middle class individuals, so they are getting their money’s worth? The aim of this study will be to getting these questions answered by a group of individuals who live in the Santa Monica area, where the AMC at The Promenade is located.