What are the negative impacts that can happen

Assignment Help Accounting Basics
Reference no: EM131991947

Assignment: Ethics in Accounting

Effective financial reporting depends on sound ethical behavior. Financial scandals in accounting and the businesses world have resulted in legislation to ensure adequate disclosures and honesty and integrity in financial reporting. A sound economy is contingent on truthful and reliable financial reporting.

Instructions: • Read the following scenario.

• Answer the questions that follow. Your answers should result in a 2-3-page submission.

• Reference back to your text book for guidance on how to think through the scenario.

Scenario: Imagine you are the assistant controller in charge of general ledger accounting at Linbarger Company. Your company has a large loan from an insurance company. The loan agreement requires that the company's cash account balance be maintained at $200,000 or more, as reported monthly. At June 30, the cash balance is $80,000. You give this update to Lisa Infante, the financial vice president. Lisa is nervous and instructs you to keep the cash receipts book open for one additional day for purposes of the June 30 report to the insurance company. Lisa says, "If we don't get that cash balance over $200,000, we'll default on our loan agreement. They could close us down, put us all out of our jobs!" Lisa continues, "I talked to Oconto Distributors (one of Linbarger's largest customers) this morning. They said they sent us a check for $150,000 yesterday. We should receive it tomorrow. If we include just that one check in our cash balance, we'll be in the clear. It's in the mail!"

1. What is the accounting problem that the Linbarger Company faces?

2. What are the ethical considerations in this case? Provide rationale for why these are ethical considerations.

3. What are the negative impacts that can happen if you do not follow Lisa Infante's instructions to wait one more day to post the balance?

4. Who will be negatively impacted if you do comply? Provide a rationale for why these individuals will be impacted.

5. What is one alternative that you could pursue in this scenario? Support your recommendations with information you learned in this class.

Reference no: EM131991947

Questions Cloud

Calculate the forward premium on foreign currency : Calculate whether international parity conditions hold between Japan and the United States. Calculate the forward premium on foreign currency
Marketing users must be able to access documents : Marketing users must be able to access documents they save in the Documents folder in their profiles from any computer they sign in to.
Members of a windows server 2016 domain : You're installing six new servers as members of a Windows Server 2016 domain. All existing servers are also running Windows Server 2016.
What was the real return on the investment : An investment had a nominal return of 10.6 percent last year. The inflation rate was 2.2 percent. What was the real return on the investment?
What are the negative impacts that can happen : What is the accounting problem that the Linbarger Company faces? What are the negative impacts that can happen if you do not follow Lisa Infante's instructions.
Requirements for the remaining staff : What can you suggest to maintain a strict password policy for the five managers but loosen requirements for the remaining staff? What steps would you take?
In what specific ways are they similar : Summarize the key points from each video. In what specific ways are they similar? How are they different?
Companies with similar risk characteristics : Companies with similar risk characteristics and 40% debt can borrow at 9.5%. Would the company lower its WACC if it increased its debt to 40%?
Construct a dsquery command that pipes : Construct a dsquery command that pipes to a dsmod command that will enable all accounts that are disabled.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd