Reference no: EM132485423

Point 1: You have just graduated from the local University and landed what you had thought was a great job as an accountant for Crazy House Interiors, an upscale design studio. Your apartment is wonderful and you have made a lot of new friends. However, you boss has just asked you to "do him a favor." Crazy House is planning to ask one of the local banks for a loan. However, there is some concern because this year's revenues are considerably lower than the revenues of the previous year. One of the more talented designers has just landed a contract for a large, profitable project. Half of the fee for the project is to be collected when the contract is signed at the end of this week, with the remainder of the money due when the project is completed. Work will begin on the project when the contract is signed. Your boss has asked you to record the initial payment of $125,000 as revenue at the time the money is received. Not wanting to disappoint the boss, you originally agreed to record the transaction as he requested.

Question 1: However, you are having second thoughts about recording the transaction and your ethical responsibilities. What should you do? Why?