Reference no: EM132699843
Wild Adventure conducts tours of wildlife reserves around the world.
The company recently purchased a lodge in Adelaide, Australia, securing a 4% mortgage from First Bank. In addition to monthly payments, Wild Adventure must provide annual reports to the bank showing that the company has a current ratio of 1.2 or better. After reviewing the annual reports, the CEO, N. O. Scrooge, approached Carl Hauptfleisch, the CFO, and stated, "We've decided we are going to move all our long-term debt investments into our brokerage account so we can sell them soon. Carl, go ahead and make the adjusting entries as of the current year-end." Carl made the adjustments even though he doesn't think the company will actually go ahead with the planned sale of the long-term debt investments. The subsequent year, the economy turned, and the company's travel revenues dropped more than 60%. Wild Adventure eventually defaulted on the First Bank loan.
Requirements
Question 1. What effect did the adjustments have on the financial statements? What effect did the adjustments have on the current ratio?
Question 2. What type of information in the financial reports would have helped the bank detect this reclassification?
Question 3. Has a fraud occurred? If so, what is the fraud?
|
How the lessee calculates the present value of lease payment
: How the lessee calculates the present value of its lease payments under the lease, with the aim to measure its lease liabilities and assets.
|
|
Calculate the pressure of the same sample
: The van der Waals equation of state was designed (by Dutch physicist Johannes van der Waals) to predict the relationship between pressure p, volume V
|
|
Create a formula for the monthly cost of SUVs for Kleenaire
: The company incurs $200,000,000 of variable manufacturing overhead resources to produce 50,000 SUVs per month. Create a formula for the monthly cost of SUVs
|
|
Calculate the pressure of dinitrogen monoxide gas
: Calculate the pressure of dinitrogen monoxide gas in the reaction vessel after the reaction. You may ignore the volume of the liquid reactants.
|
|
What effect did the adjustments have on financial statement
: Wild Adventure, What effect did the adjustments have on the financial statements? What effect did the adjustments have on the current ratio?
|
|
Heat neutralization experiment
: Calculate the heat gained by the solution and use this to calculate the enthalpy change of the neutralization reaction in joules per mole of water formed.
|
|
What is the expected fixed cost
: If the department expects to manufacture 6,000 flash drives next month, what is the expected fixed cost? Total variable cost? Total manufacturing cost
|
|
How organizations set transfer prices is covered
: How organizations set transfer prices is covered in your readings. does VGE set its transfer prices (i.e., royalty payments) more on market prices
|
|
Atomic emission spectra experiment
: Gas sample = H2Emission lines: (Blue, Green, Red) Wavelengths for each emission line: Blue= 434.3575 , Green= 486.3128 , Red= 657.2626
|