Illustrate what are the ethical issues involved

Assignment Help Financial Accounting

Reference no: EM13130040

Charlie Brown, controller for the Kelly Corporation, is preparing the company's income statement at year-end. He notes that the company lost a considerable sum on the sale of some equipment it had decided to replace. Since the company has sold equipment routinely in the past, Brown knows the losses cannot be reported as extraordinary. He also does not want to highlight it as a material loss since he feels that will reflect poorly on him and the company. He reasons that if the company had recorded more depreciation during the assets' lives, the losses would not be so great. Since depreciation is included among the company's operating expenses, he wants to report the losses along with the company's expenses, where he hopes it will not be noticed.

Based on the above scenario, please respond to all of the following prompts:

What are the ethical issues involved?

What should Brown do?

Reference no: EM13130040

Questions Cloud

Absolute change and percentage change : Find the absolute change and the percentage change in the following case. The population of a country increased from 99 million in 1990 to 259 million in 2010.

Compute whip subchapter s income or loss : Whip, Inc., is a calendar year S Corporation. Whip's book income this year totals $90,000. Whip is owned equally by three shareholders. From supplemental data, you obtain the following information about items that are included in book income.

What does the ife suggest about expected inflation : What does the IFE suggest about differential in expected inflation in these two countries? Using this information and the PPP theory, describe the expected nominal return to U.S. investors who invest in Mexico.

How much did the startup division make : The startup division made 80% of 1/2 of the established division. The startup division's growth was 1/3 greater than the established division's. If the divisions made 280,000 combined, how much did the startup division make?

Illustrate what are the ethical issues involved : Charlie Brown, controller for the Kelly Corporation, is preparing the company's income statement at year-end. Illustrate w hat are the ethical issues involved? What should Brown do?

What other roles do accountants play in organizations : What would be the appropriate level of involvement of an accountant in evaluating and selecting an AIS vendor and the AIS itself? What are some of the contributions an accountant might offer in this process?

How does the rise of human inches in nature : how does the rise of human inches in nature and structure of the physical body relate to the eventual rise of psychology as a formal discipline? Provide specific samples

Create confidence interval for true mean diameter of nickel : Construct a 99 percent confidence interval for the true mean diameter of a nickel. (c) Discuss any assumptions that are needed. (d) What sample size would ensure an error of ± 0.0005 inches with 99 percent confidence?

What about a foreign-based multinational corporation : Does a state have the authority to require a U.S.-based multinational corporation to compute its state taxable income on a worldwide combined reporting basis? What about a foreign-based multinational corporation? Explain.

User Account

All Pages