Dole Food Company Essay Example | Topics and Well Written Essays - 750 words

Dole Food Company - Essay Example In July 2001, it was reincorporated as a Delaware corporation. Its headquarters is located in Westlake village, California. Dole is one of the world’s leading producers of pineapples, bananas, packed fresh vegetables, salads and fruit products. In the fiscal year ended 2, 2010, this company generated operating income of about $352 million and total revenue of approximately $6.8 billion. By January 2, 2010, Dole had total revenue of $4.1 billion. Dole has divided its business operations into three segments: the fresh vegetable segment produces and distributes fresh-packed and value added salads, and vegetables to institutional customers and retailers primarily in Europe, North America and Asia (Dole Food Company, Castle & Cooke, Inc, 2003). The fresh fruit segment is divided into several departments, which are responsible for the production and distribution of fresh fruits to retail, wholesale and institutional customers worldwide. The third segment is packaged foods segment, w hich also includes a number of divisions that process and distribute packed foods including frozen fruit, juices, fruit and healthy snack food (U.S. International Trade Commission, 2002). The writer chose to analyze the accounting process and financial statements of Dole Food Company because of its outstanding performance in the food processing industry. In addition, it was not difficult obtaining the company’s financial statement since my mother works in the company as a quality assurance manager. The financial statements used for this project were obtained from the internet, by opening the company’s Website link I was given by my mother. The main aim of this paper is to understand the analysis of the accounting process and financial statements of Companies by focusing on Dole Food Company. In the paper, I will analyze Dole’s balance sheet, statements of cash flow, and income statements. Before analyzing Dole’s accounting process and financial statements , it is necessary to understand some of the key accounting concepts and terms that are used by Dole’s accountants when recording and balancing financial statements and other transactions. 1) Generally Accepted Accounting Principles (GAAP) - this principle refers to the standard framework of guidelines for financial accounting (Bernstein & Wild, 2000). It includes conventions, standards and principles that accountants observe when recording and balancing financial statements and other transactions. GAAP can be obtained from several sources including promulgation of the Accounting Principle Board and Financial Accounting Standards (Pefianco & Rosario, 2006). 2) Accrual Basis verses Cash Basis Accounting: accrual basis is the income earned and reported in particular periods despite of when it was received (Costales & Szurovy, 1993). It also includes the expenses that were incurred regardless of whether they were paid or not. In the financial statements used for this project, it is evident that Dole’s accountants recorded both expenses and income when they occurred. Cash basis accounting involves recording of transactions based on cash position and cash flow. Revenue is recorded upon cash receipt, and expenses when cash is paid. This accounting method is evident in Dole’s financial statements; however, it is not commonly used like Accrual Basis Accounting (Hey-Cunningham, 2007). 3) Current Assets and Liabilities verses Non-Current Items: Current assets are items that are available in cash form, or can be changed into cash within a short period (Dyckman, 2001). Example that is present in Dole’s financial statement is inventory or accounts receivable. Fixed assets, on the other hand, are assets which cannot easily be converted