Reference no: EM13870850
Travel and Entertainment
On a recent trip to Africa, J. T. Brown, sales manager of Prompt Technology, took his wife along at company expense. Linda White, vice president of sales and Brown's boss, thought his travel and entertainment expenses seemed excessive. But White approved the reimbursement because she owed Brown a favor. White was aware that the company president reviews all expenses recorded in the cash payments journal, so White recorded Brown's wife's expenses in the general journal as follows: debit to Sales Promotion Expense for $9,100 and credit to Cash for $9,100.
Requirements
1. Does recording the transaction in the general journal rather than the cash payments journal affect the amounts of cash and total expenses reported in the financial statements?
2. Why did White record these expenses in the general journal?
3. What is the ethical issue in this situation? What role does accounting play in this issue?
Instructions: Your initial response should be no less than 250 words with at least one scholarly journal reference (dictionary-type websites are excluded). In-text citations and references must be in APA format. Refer to the Forum Grading Rubric below for additional guidelines.
Make sure you are using credible sources in your discussions and assignments. Scholarly journals are the preferred source of credible/quality references. These consist of peer-reviewed articles published in academic journals related to the field, which are found via our Library. Websites such as Investopedia, ask.com, answers.com, or dictionary-type of websites limit the insight to the topics. Wikipedia is not acceptable as it is not a reliable, credible source of reference. The purpose is to bring in new information and how does it apply to our topic from a real-world perspective, instead of extending on definitions that are found in the book.
More information what a credible source consists of can be found here: https://writingcommons.org/evidence/supporting-sources/630-what-might-be-a-more-credible-reliable-source.
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