Case Name :      Physicians for You, LLC: Estimating Asset-Related Expenses

Authors :           Mark E. Haskins

Source :             Darden School of Business

Case ID :           UV1776

Discipline :        Finance

Case Length :    06 pages

Solution Sample availability : YES

Plagiarism : NO (100% Original work)

Students explore the variability in earnings due solely to the need to make estimates for several common financial statement asset-related expense items. They consider depreciable asset lives and residual values; estimated uncollectible accounts receivable; and temporary versus permanent losses on marketable equity security investments. The case can be used as an asset module capstone case either an undergraduate- or graduate-level introductory financial reporting/accounting course. Alternatively, it could be used to introduce the asset module of an accounting course. A new medical practice is about to be launched and is seeking investors. As one of the doctors puts the final touches on a pro forma income statement, he must make several estimates that are required/allowed under generally accepted accounting principles (GAAP) to finalize the projected first year earnings figure.