Purpose: To help you understand and compare the performance of two companies in the same industry.
Go to the Bombardier Annual Report located in MyAccountingLab. Now access the Annual Report for The Boeing Company. To do this from the internet, go to the company’s web page for Investor Relations at
http://www.boeing.com/companyoffices/financial/quarterly.htm and download the annual report for the year ended December 31, 2010.
Identify three accounts for each company that indicate that both Bombardier and Boeing use the accrual basis of accounting. Why do you think using the accrual basis of accounting would be more helpful for analysis purposes than the cash basis for these two companies?