The Following Note Disclosure Appeared in a Recent Annual Report

question 5

Essay

The following note disclosure appeared in a recent annual report of Halliburton:

Our receivables are generally not collateralized. Included in notes and accounts receivable are notes with varying interest rates totaling $12 million at December 31. At December 31, 39% of our consolidated receivables related to our United States government contracts, primarily for projects in the Middle East

-Explain the reason that Halliburton indicates that its receivables are generally not collateralized. What significance does this have to the reader?

Understand the exceptions to the Statute of Frauds that allow for oral contracts to be enforceable.

Recognize the role of the Uniform Commercial Code (UCC) in determining the writing requirements for sales contracts.

Recognize the significance of a party's signature in constituting an enforceable contract under the Statute of Frauds.

Understand the impact of the Statute of Frauds on the enforceability of contracts involving the sale of goods.

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Definitions:

Credit Column

The section of a financial statement or ledger where increases in liabilities, equity, and revenue or decreases in assets and expenses are recorded.

Journalized Transactions

Recording financial transactions in a journal as part of the double-entry bookkeeping system.

Posting

Posting refers to the process of transferring entries from a company's journal into their respective accounts in the general ledger.

Financial Statements

Summarized records of a company's financial activities and position, typically comprising the balance sheet, income statement, and cash flow statement.