What are the probable consequences of the given behavior

Assignment Help Financial Accounting

Reference no: EM13940850

Case: ETHICS AND REVENUE RECOGNITION

Alan Dunlap is CEO of a large appliance wholesaler. Alan is under pressure from Wall Street Analysts to meet his aggressive sales revenue growth projections. Unfortu- nately, near the end of the year he realizes that sales must dramatically improve if his projections are going to be met. To accomplish this objective he orders his sales force to contact their largest customers and offer them price discounts if they buy by the end of the year. Mr. Dunlap also offered to deliver the merchandise to a third-party warehouse with whom the customers could arrange delivery when the merchandise was needed.

Required:

1. Do you believe that revenue from these sales should be recognized in the current year? Why or why not?

2. What are the probable consequences of this behavior for the company in future periods?

3. What are the probable consequences of this behavior for investors analyzing the current year financial statements?

Reference no: EM13940850

Questions Cloud

Singapore building and construction authority contractors : Lian Beng Construction incorporated in 1988 has an A1 grading in the General Building category and an A2 grading in Civil Engineering category under the Singapore Building and Construction Authority Contractors Registry System According to these g..

Develop a management consultancy practice : Now, assume that the firm wants to develop a management consultancy practice. (Alternatively, you may choose to add a legal services line instead.). Create a separate new matrix that summarizes the additional risk factors for this firm launching a..

How humane is capital punishment : Would a death sentence in John's case result in specific or general deterrence? To other officers? To the community in general? To other criminals? How does the data measure up to the myths and misconceptions generally held about capital punishmen..

Devise a marketing strategy to launch : Develop a new product and devise a marketing strategy to launch the product into the market place. Has to be in Power Point presentation. This is the name of our product COMPAL FRESH JUICE.

What are the probable consequences of the given behavior : What are the probable consequences of this behavior for investors analyzing the current year financial statements?

Implement 1-parameter date constructor that receives string : Date objects should store the date in two int instance variables: day and month, and it should include the String instance variable, error, initialized with null.

Information on the competitive environment : What demographic and geographic information should Eddie Bauer collect to select store locations? What information on the competitive environment should Eddie Bauer collect?

Gathering or using marketing intelligence : Your task is to explain how the situation in the article relates to a topic in this course. For example, an article might discuss how a company is gathering or using marketing intelligence.

How would the contract be reflected in the balance sheets : If Ms. McGonigle's proposal is adopted, how would the contract be reflected in the balance sheets at the end of 2008 and at the end of 2009?

User Account

All Pages