Intermediate Accounting II Professor Martha Suez-Sales University of Guam School of Business & Public Administration September 24, 2015 Aeropostale Background Aeropostale is a mall based retail store that markets casual apparel and accessories. They target ages 14 to 17 year-old young men and women. They opened their first store in 1987 in the New York Area. Aeropostale now activates 800 stores in 47 states, Puerto Rico, and Canada. Aeropostale Inc. offered a new trend on June 2009, which targets girls and boys ages 7 to 12, which they called P.S. from Aeropostale™. P.S. from Aeropostale™ operates 26 stores in 12 states and Puerto Rico. Aeropostale products can be purchased at their physical stores, and on their online stores …show more content…
The fair value hierarchy is categorized into three parts: Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 – Observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data. Level 3 – Unobservable inputs reflecting the Company’s own assumptions about the inputs that market participants would use in pricing the asset or liability based on the best information available. (Aeropostale, 2014, 57) In accordance to ASC 820-10-35, we will analyze Aeropostale's 2014 annual report and make recommendations. …show more content…
The update is introducing a new reporting entity to measure the fair value of certain investments using the net asset value per share of the investment. The update removes the requirement of using fair value hierarchy in measuring the investments; instead they required using the net asset value per share practical expedient. The amendments also applies to make certain disclosures for all the investments to measure the fair value using the net asset value per share practical expedient (FASB Accounting Standards Update, May