John has recognized potential ethical issue

Reference no: EM133650419

Question

John is the controller of a small electronics retailer. His boss, Rosalie, instructs him to increase the company's accounts receivable balance for an amount that is material to the financial statements by decreasing the allowance for doubtful accounts. Politely discussing the matter with her, John tells Rosalie he is concerned that making this entry would make the financial statements misleading under generally accepted accounting principles (GAAP). Which statement best describes this situation? John has established himself as a problem employee. John has recognized a potential ethical issue. John failed to consider the rules of other regulators. John overstepped his authority by questioning his.

Reference no: EM133650419

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