UNIVERSITI KUALA LUMPUR

BUSINESS SCHOOL

ASSIGNMENT

OCTOBER 2023 SEMESTER

COURSE CODE : EAB20703

COURSE NAME : FINANCIAL ACCOUNTING AND REPORTING 2

PROGRAMME NAME : BACHELOR IN ACCOUNTING (HONS)

DURATION : 10 WEEKS BY 8TH JANUARY 2024

GENERAL INSTRUCTIONS

1- Form groups that consist of 3 members per group.

2- Appoint a group leader and submit the group members’ name.

3- Produce a final report that contains details of each of the Assignment which is concise, precise

and well-presented and structured.

4- The report MUST be handed over before the end of the TENTH WEEK (8TH JANUARY 2023) via

the LMS for the Soft Copy.

Target Corporation Case

Target Corporation is a general merchandise retailer with stores in all 50 U.S. states
and the District of Columbia. Target Corporation is headquartered in Minneapolis,
Minnesota, its hometown since the first Target store opened in 1962 under the Dayton
Company.

Target Corporation prepares its Financial Statements according to U.S. GAAP.

Target’s financial Statements and disclosure notes for the year ended February 3,
2021, are available in Investor link of company’s website:
https://corporate.target.com/getmedia/47f21e1d-6732-4e40-a7fb-
3fb1c8510466/2021-Target-Annual-Report.pdf

Required:
1. What amounts did Target Corporation report for the following items for the year
ended February 3, 2021?
a. Gross margin
b. EBITDA
c. EBIT
d. EAT

2. Does Target Corporation report any items as part of its comprehensive income? If
so, what are they?
3. Does Target Corporation prepare the statement of Cash Flows using the direct
method or Indirect method?
4. Which is higher, net earnings or operating cash flows? Which line item is biggest
reason for this difference? Explain why.
5. What is the largest investing cash flow and the largest financing cash flow
reported by the company for the year ended February 3, 2021?

(40 marks)

Air France-KLM Case

The Air France-KLM Group, a Franco-Dutch company, operates one of the most
extensive flight networks between Europe and the rest of the world. The network is
structured around the Group's two intercontinental hubs in Paris and Amsterdam,
which are two of the four largest correspondence hubs in Europe.
Air France-KLM (AF) prepares its financial statements according to International
Financial Reporting Standards. AF’s financial statements and disclosure notes for
the year ended December 31, 2022, are provided in Finance Link of the company’s
website:
https://www.airfranceklm.com/en/finance/financial-results

Required:

1. How does AF classify operating expenses in its income statement? How are
these expenses typically classified in a U.S. company income statement?

2. How does AF classify interest paid, interest received and dividends received
in its statement of Cash Flows? What other alternatives, if any, does the
Company have for the classification of these items? How are these items
classified under U.S. GAAP?

3. Choose THREE (3) from followings and explain main differences between
U.S. GAAP and IFRS:

a. Financial Periods Required

b. Layout of balance sheet and income statement
c. Balance sheet - presentation of short-term loans refinanced with long term
loans after balance sheet date
d. Balance sheet - presentation of debt as current versus noncurrent
e. Income statement - classification of expenses
f. Income statement - discontinued operations criteria
g. Statement of cash flows - restricted cash
h. Disclosure of performance measures
i. Third balance sheet

(60 marks)
[Total 100 marks]