Essay on Disclosure: Summary of notes

Submitted By murasakidevil
Words: 506
Pages: 3

Note 1: Summary of Significant Accounting Policies

Company
Throughout this document Green Dog Product INC. is referred to as we or the Company. We are an organic dog food retailer situated in San Francisco. These products are sold in the company's own retail outlets along with other partnered retailers. The Company was established by Patricia Hopland in 1982 and became public in 1994.

Accounting Principles
The financial statements and the accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America.

Fiscal Year
The company utilizes a 52-week fiscal year, which ends on 31 of July; the beginning of fiscal year starts on 1st of August.

Use of Accounting Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses during the reporting period and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates.

Revenue Recognition
The company’s principal sources of revenue are from the sales of the dog food products and gift cards. Sales are mainly made on trade account basis and payment discounts are not immediately offered. Gift cards are recognized when tendered for payment, or upon redemption. Revenue from Gift Cards are earned when they are redeemed. Gift cards are store credits that do not expire nor have a service charge when used.

Inventory
Inventories consist of dog food products are stated at the lower cost or current market value, based upon the last in, first out method.

Property, Plant and Equipment
Building and equipment are showed on the balance sheet at cost less accumulated depreciation. Depreciation on building and equipment are provided on the straight-line method over estimated useful lives.

Earnings Per Share:
Basic earnings per share is compared using the weighted average number of shares of our common stock outstanding during this…