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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Mani1 who wrote (228537)	4/10/2005 3:22:55 AM
From: i-node	Read Replies (1) \| Respond to of 1576885

>>> LOL, they should take your CPA license away :) I haven't practiced in 10 years, and nearly gave it up voluntarily after the Enron fiasco. >>> First of all, LIFO accounting is not allowed in Europe, where many of the oil companies are located. Only American companies can use it. Yeah, I don't know what they do in Europe. I was really referring to XOM & other American companies. >>> Second you got it completely backward. LIFO accounting REDUCES net income during inflationary environment. I didn't get it backwards. If you read my post, I said "to the extent they're using those inventories" -- meaning, eating into old LIFO layers (which were bought/produced at lower prices). When you deplete LIFO inventory during a time of rising prices it has the effect of expensing less expensive product while recognizing higher and higher revenue. Thus, the usual "matching" principles are distorted. In extreme case, where all LIFO layers are being utilized, you may be recognizing revenue for $2.00/gallon gas that was produced when the selling price was $0.27/gallon. >>> Sorry, LIFO accounting method has nothing to do with why these companies’s are making record earnings. I don't know whether it does or not. I simply made the point, and it was a correct point, that without looking intensely at these companies' financial statements it is not possible to know what the cause is for rising profits. >>> As far as competitive market taking care of everything, well that is what everyone said during California’s “energy crisis”. It did not turned out to be correct. California's energy crisis is precisely what happens when you get regulation gone wild by out of control liberals. They cut their own throats and frankly, got what they deserved. Next time someone wants to build a power plant, maybe Californians will think twice before tying their hands with unnecessary regulations.