In Intermediate Accounting

The well-known apparel brand Gap is owned by The Gap Inc., originally incorporated in California on July of 1969, and reincorporated in Delaware on May 1988.   Its stocks are traded in the New York Stock Exchange under the ticker name GPS.Other than the brand Gap, it operates other famous brands as well such as Old Navy, Banana Republic, Piperlime, and the now-discontinued Forthe & Town.   These brands cater to different markets, offering different lines of products and prices.The Gap products are moderately priced, classically designed clothing line for casual use by men, women, and children of different ages.   These include basic clothing as jeans, slacks, and T-shirts, as well as maternity apparels.   It has its own line for children called GapKids and for babies aptly called BabyGap.Old Navy products likewise cater to different ages of men, women, and children but are relatively cheaper and innovative in styles and designs while Banana Republic products are the highest p riced since it carries lines for the sophisticated market such as fashion and tailored apparels.The Gap Inc.’s latest fiscal year ends on February 03, 2007 which practically covers the business transactions of 2006.   the accounting period started on January 28, 2006, and may be considered irregular if viewed on the number of business days notwithstanding leap years.Further observation however reveals that The Gap Inc. uses a 52-week accounting period as the reckoning period and not the number of business days.One reason is that sales trend is analyzed using weekly figures.   The 52-week reckoning period is also in line with the employee wage payouts, mostly composed of sales attendants stationed in different stores and branches, and are usually paid on a weekly basis.IBMIBM, short for International Business Machines Corporation was originally incorporated in New York on 1911 using the name Computing-Tabulating-Recording Co. It changed to its present name on 1924 and from then on became a symbol of quality business machine products.It has now evolved to a â€Å"globally integrated innovation company† offering a wide range of products and services to its customers and clients alike.   Its business is now composed of three broad segments: Systems and Financing, Software, and Services.   Systems and Financing includes hardware products such as servers, data storage systems, microelectronics, printing systems, and retail store solutions.   An allied service, Financing covers commercial, client, and remarketing financing.Under the Software segment, IBM operates technical brands such as Information Management Software, Lotus, Tivoli, WebSphere and Product Lifecycle Management, performing specialized functions to help meet the software needs of clients.   Lastly, Services is perhaps the fastest growing segment of the company.Through this arm, IBM is engaged in business process outsourcing, consulting in different aspects of business, informa tion technology set up, management, and maintenance.   Its personal computer segment, practically the single segment that brought IBM to world renowned brand name, was sold to Lenovo of China sometime in 2005.IBM follows the traditional accounting period, always starting on January 1 and ends on December 31, regardless of the number of weeks or business days on a given year.This is so because the company does not experience seasonal sales as with the Gap Inc. or any other retail firm where fashion and trends play a big part.   Due to the very nature of IBM’s products and services, the demand for such is largely dictated by development in technology and business practices, and can be said, at the least, unpredictable.This is magnified by the rapidity of technological advances in computers.   Thus, to best capture the trends of its business, the annual basis of reporting is used.