Reference no: EM132471409 , Length: 3
Point 1: You have been recently hired as an assistant controller for XYZ Industries, a large, publically held manufacturing company. Your immediate supervisor is the controller who also reports directly to the VP of Finance. The controller has assigned you the task of preparing the year-end adjusting entries. In the receivables area, you have prepared an aging accounts receivable and have applied historical percentages to the balances of each of the age categories. The analysis indicates that an appropriate estimated balance for the allowance for uncollectible accounts is $180,000. The existing balance in the allowance account prior to any adjusting entry is a $20,000 credit balance.
Point 2: After showing your analysis to the controller, he tells you to change the aging category of a large account from over 120 days to current status and to prepare a new invoice to the customer with a revised date that agrees with the new category. This will change the required allowance for uncollectible accounts from $180,000 to $135,000. Tactfully, you ask the controller for an explanation for the change and he tells you "We need the extra income, the bottom line is too low."
Required:
In a 2-3 page paper, discuss the following:
Question 1: Consider what you have learned relative to ethics and financial reporting. What is the rationale for the calculations/process used to estimate the $180,000 uncollectible allowance?
Question 2: How do you think the misstatement of funds will impact the income statement and balance sheet?
Question 3: What is the ethical dilemma you face? What are the ethical considerations? Consider your options and responsibilities as assistant controller.
Question 4: Identify the key internal and external stakeholders. What are the negative impacts that can happen if you do not follow the instructions of your supervisor?
Question 5: What are the potential consequences if you do comply with your supervisor's instructions? Who will be negatively impacted?
Price elasticity of demand that is elastic or inelastic
: If Walmart is rolling back prices to raise revenues, should it roll back prices on products that have a price elasticity of demand that is elastic or inelastic.
|
How does the analysis of macroeconomic control
: How does the analysis of macroeconomic control need to be modified when considering the open, rather than the closed, economy?
|
Determine how many pizzas must gary sell to break even
: Determine how many pizzas must Gary sell to break even? If budgeted sales total 8,500 pizzas, determine how much is the company's safety margin in dollars?
|
Continue to purchase the item even if the price goes up
: Does it make a difference if the item is an essential item, like food vs. a luxury item like a sports car whether you are likely to continue to purchase
|
What have learned relative to ethics and financial reporting
: What have learned relative to ethics and financial reporting. How do you think the misstatement of funds will impact the income statement and balance sheet?
|
Discuss recent news using microeconomic terminology
: Please note that the goal of this discussion is to read, understand, and discuss recent news using microeconomic terminology.
|
Domestic market for non-durable consumer products
: The third company operates only in the domestic market for non-durable consumer products (e.g., a domestic restaurant chain).
|
Discuss cost savings associated with payroll
: Discuss Cost savings associated with payroll and other personnel costs (i.e. training and development, employee hiring). discuss More accurate
|
Levels of private consumption
: How would this policy affect the levels of private consumption, investment, and net exports of Argentina's economy this year?
|