RevenueEquipmentsales.Supplies,paperandother.Sales.Service,outsourcingandrentals…………………….•……….Financeincome.TotalRevenues.$ 3,857$ 3,550$ 4,6793,3773,0963,646———7,2346,6468,32513,7397,8208,485660713798—21,63315,17917,608continued){erOj~COrporationP(RX}—‘—_..__ .._—-_….._. __…..__ ._-_•.•._._…—-.-.–.._———_.. – —
5-47Module5I ReportingandAnalyzingOperatingIncomecontinuedfrompriorpageCostsandExpensesCostofsales..Costofservice,outsourcingandrentals.Equipmentfinancinginterest.Research,developmentandengineeringexpenses.Selling,administrativeandgeneralexpenses.Restructuringandassetimpairmentcharges.Acquisition-relatedcosts.Amortizationofintangibleassets.Otherexpenses,net.TotalCostsandExpenses.Income(Loss)beforeIncomeTaxes,andEquityIncome.Incometaxexpense(benefrt).-11..Equityinnetincomeofunconsolidatedaffiliates.Netincome.Less:Netincomeattributabletononcontrollinginterests.NetincomeAttributabletoXerox.4,7414,3955,5199,1954,4884,9292462713057818408844,5944,1494,534483(8)429777231260543892851,033—20,81814,55217,687—815627(79)256152(231)7841113—637516265313135—$606$485$230Notes:• TheincomestatementincludessalesofXeroxcopiersandrevenueearnedbya financesubsidiarythatprovidesloanandleasefinancingrelatingtothesalesof thosecopiers.• EquityinnetincomeofunconsolidatedaffiliatesreferstoincomeXeroxhasearnedoninvestmentsin affiliated(butunconsolidated)companies.. Requireda.Xeroxreportsseveralsourcesof income.Howshouldrevenuebe recognizedforeachof thesebusi-nessactivities?Explain.b.Computetherelativesizeof Salesrevenue(total)andof revenuefromService,outsourcingandrent-als.Hint:Scaleeachtypeof revenuebyTotalrevenue.Whichtypeof revenuegrewmorein 20 IO?c.Xeroxreportsresearch,developmentandengineeringexpenses(R&D)eachyear.CompareR&Dspendingoverthethreeyears.Hint:ScaleR&DbyTotalrevenueeachyear.Whatmightexplainthechangein 2010?d.Xeroxreportsrestructuringcostseachyear.(1)Describethethreetypicalcategoriesof restructur-ingcostsandtheaccountingforeach.(2)Howdoyourecommendtreatingthesecostsforanalyspurposes?(3)Shouldregularrecurringrestructuringcostsbetreateddifferentlythanisolatedoccur-.111.rencesof suchcostsforanalysispurposes?(4)Whatdoesthe$(8)expensein 2009implyaboutoneor morepreviousyear’saccruals?~’ .’e. Xeroxreports$389millionin expensesin 2010labeledas “Otherexpenses,net.”Howcana com-~._~_.panyusesuchan accountto potentiallyobscureitsactualfinancialperformance?.. .i:,”~”‘–‘.. >.”c:jiII!—1fZ5’f’E#§iJyzmg-!Jiiti!tpret~~.K;’:
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Reporting-Ana….pdf