Obtain Under Armour\'s 2009 10-K (filed in 2010) through the \"Investor Relation
ID: 2719511 • Letter: O
Question
Obtain Under Armour's 2009 10-K (filed in 2010) through the "Investor Relations" portion of their website. (Using a search engine, search for: Under Armour investor relations.) Once at the Investor Relations section of the website, look for "SEC Filings." When you see the list of all the filings either filter for the "Annual Filings" or search for "10-K." Another option is to go to http://www.sec.gov and click "Search for Company Filings" under "Filings & Forms."
Required:
1. Look at the "Reserve for Uncollectible Accounts Receivable" heading to Note 2 (Summary of Significant Accounting Policies). Does Under Armour use the percentage of credit sales method or the aging method to estimate bad debt expense?
2. Looking at the same note, what was Under Armour's allowance for doubtful accounts in 2009 and 2008?
3. Was a larger percentage of the gross accounts receivable considered uncollectible at December 31, 2008 or 2009?
4. Calculate Under Armour's receivables turnover for 2008 and 2009 (Accounts Receivable, net, was- $93,515 at December 31, 2007). (Note: Round answers to two decimal places.) If the industry average for receivables turnover is 24.78, how do you evaluate their efficiency with receivables?
5. Calculate Under Armour's gross profit margin, operating margin, and net profit margin for 2008 and 2009. (Note: Round answers to two decimal places.)
Explanation / Answer
1.) Amour uses the percentage of credit sales method estimate bad debt expense.
2)allowance for doubtful accounts was $5.2 million and $4.2 million, respectively.
4) Receivable turnover ratio = credit sales/average receivales
5.
year 2008 2009 Turnover 725244 856411 Accounts recievable 81,302 79356 Average Accounts recievable 87408.5 80329 Receivables turnove 8 11Related Questions
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