Please use the following textbook in answering the
questions:
Palepu,
K.G. & Healy, P.M. (2008). Business
Analysis and Valuation: Using Financial Statements: Using Financial Statement;
Text and Cases (4th ed.). Cengage Learning.
The following
questions pertain to the Anacomp case in the Palepu text (Additional Cases
section), pages 27-49
2. (25 points) Evaluate Anacomp’s business new product
development strategy. What are the risks and benefits of this strategy for
Anacomp’s shareholders?
3. (20 points) How is Anacomp’s accounting influenced by the
way the company organizes and finances its new product development?
Note: At the time
of the case, software developments costs were allowed to be capitalized even
when a company did not use the R&D partnership mechanism.
4. (15 points) Compare Anacomp’s cash flow performance with
its accounting performance. What is your
evaluation of the company’s financial condition?
5. (10 points) What is your assessment of Anacomp’s future? Justify
your answer.
Show all your work/calculations
(partial credit applies). Do not write as a paper, simply answer the above
questions, but provide the supporting detail in doing so. Number each answer
according to the corresponding question.
