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Case Study - Business Memo
CASE 1 - You were just hired by Bertha's Bakery as their new accountant. Bertha Beckendorf, the owner, provided you with copies of invoices for the year for baking supplies (assume all baking supplies are used up the day they are delivered). You noticed that one particular invoice from Fred's Flour was for a delivery of flour made to the Bakery on December 29, 2013, but is not due until January 10, 2014. There was no accrual of this expense in the Bakery's December 31, 2013 Trial Balance. Write a Business Memo in proper format to Bertha Beckendorf explaining how the invoice should be accounted for and why.
CASE 2 - Assume you are the accounting manager for Logan's Landscaping & Design. On December 1, 2013, Logan Karver, the owner, presents you with a check for $15,000 from a customer, Anna DeJuliet, to do a landscape design at her residence as soon as the ground thaws in the spring of 2014. No work on this project can be done until then. Logan wants you to deposit the check and include the $15,000 in the 2013 income statement. He is expecting to include the $15,000 in his 2013 net income in order to secure a loan from the bank in January 2014 for some new equipment. Write a Business Memo in proper format to Logan explaining how this check should be accounted for and why.
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