Category: Accounting

In the accounting field, you may one day be put in a compromising situation in which you question the morality or integrity of the actions taken and future actions that need to be taken. For this discussion, you will discuss possible actions to take when an authority figure/company puts you in a compromising situation. As you read the scenario and answer the questions, consider GAAP principles, continual updates and nuances to methods and GAAP, and GAAP ethics.
First, read from Chapter One in your textbook in the Review and Practice section: Critical-Thinking Cases CT1.13 Ethics (Rule Making Issues). Then, address the following questions in your initial post:
From your point of view, is there an ethical issued involved in this case? In your own words, explain why there is or is not an ethical issued involved and what the issue is.
Is the financial vice president acting improperly or immorally? Why?
What does Weller have to gain by advocacy of early implementation?
How might stakeholders be affected by the decision against early implementation?
Should we hold financial decision makers and companies responsible and why?
In your responses to two peers, respond to their initial post and add to the conversation about possible actions to take when an authority figure/company puts you in a compromising situation. Provide examples from personal experience or recent events.
To complete this assignment, review the Discussion Guidelines and Rubric.
To complete this assignment, review the Discussion Rubric.
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Peer 1)After reading through the case it seems that when the FASB creates new rules they have a 12 month implementation period from their date of issuance. Within this policy it states that early implementation is encouraged. While Weller was pushing for the early implementation because “it would cause a fairer presentation of the company’s financial condition and earnings”. The vice president she spoke with decided to not implements the rule early because the vice president deemed it would adversely affect their reports. This seems to me like an ethical issue is involved. Weller may only gain the good feeling of properly presenting the financial health of the company. Stakeholders may not be able to gain the better representation of the financials of the company or may also be adversely affected by the lower projected numbers the company may have. Yes we should definitely hold financial decision makers and companies responsible because if they act unethically or immorally they can adversely affect many clients along with their employees.
References:
Global leader in publishing, Education and research. Wiley. (n.d.). https://www.wiley.com/en-us
peer 2) There is a clear ethical issue when the financial vice president discourages early implementation of a new accounting rule because it would lower the reported net income. This action prioritizes the company’s short-term financial appearance over the long-term goal of providing transparent and accurate financial information. The role of financial reporting is to present a true picture of the company’s financial health. By delaying the implementation of a rule that ensures fairer presentation, the financial vice president is potentially misleading stakeholders, including investors, creditors, and regulators. This decision compromises ethical principles like honesty and transparency, which are crucial for maintaining trust and integrity in financial reporting.
Advocating for early implementation of the new rule, as Karen Weller suggests, has significant benefits. It demonstrates a commitment to ethical standards and ensures that the company’s financial reports are accurate and transparent. This approach not only enhances Weller’s professional reputation but also builds trust with stakeholders who rely on truthful financial information for their decisions. On the other hand, delaying the implementation can lead to stakeholders making decisions based on incomplete or misleading information, potentially causing financial losses and damaging trust in the company’s management. Holding financial decision-makers accountable for their actions is essential to maintain the integrity of financial reporting and protect stakeholders’ interests.

The following short homework essay due this week is worth 40 points:
In a very concise essay (one page), explain the concept of cardinality within the context of database relationships, and describe at least one relevant example in your answer.
Submit your assignment in a Word file upload.

Primary Task Response: Within the Discussion Board area, write 400-600 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas.
Understanding cost behavior is important for analysis and decision making. Cost can be broadly categorized as fixed, variable, or mixed. The way costs behave in relation to production drives pricing and cost estimation.
Evaluate the behavior of fixed, variable, and mixed costs in a manufacturing environment. Elaborate on an example of each type of cost as applied in a manufacturing environment. Communicate why understanding the costs you have chosen are essential in pricing and cost estimation. Responses to Other Students: Respond to at least 2 of your fellow classmates with at least a 200-word reply about their Primary Task Response regarding items you found to be compelling and enlightening. To help you with your discussion, please consider the following questions:
What did you learn from your classmate’s posting? What additional questions do you have after reading the posting? What clarification do you need regarding the posting? What differences or similarities do you see between your posting and other classmates’ postings?

The following multiple-part problem due this week is worth 40 points:
Problem 14.2 (pages 455-456) – Answer questions a through l.
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Unit 8: Financial Statements
Unit 8: Financial Statements
Identify two positions (financial analyst and Human Resources) that interest you that would benefit from accounting skills.  Re
Describe two ways that you feel better prepared to manage either your personal finances or the finances of your current employer.

Forever Pure produces two types of water filters. One attaches to the faucet and cleans all water that passes through the faucet. The other is a pitcher-cum-filter that only purifies water meant for drinking.
The unit that attaches to the faucet is sold for $72 and has variable costs of $20.
The pitcher-cum-filter sells for $88 and has variable costs of $16.
Forever Pure sells two faucet models for every three pitchers sold. Fixed costs equal $960,000.
What is the break-even point in unit sales and dollars for each type of filter at the current sales mix?
Forever Pure is considering buying new production equipment. The new equipment will increase fixed cost by $166,400 per year and will decrease the variable cost of the faucet and the pitcher units by $4 and $8, respectively. Assuming the same sales mix, how many of each type of filter does Forever Pure need to sell to break even? Assuming the same sales mix, at what total sales level would Forever Pure be indifferent between using the old equipment and buying the new production equipment? If total sales are expected to be 23,000 units, should Forever Pure buy the new production equipment? Assess lessons learned concerning cost-volume-profit analysis and decision making.

ASSIGNMENT_blue.png Please read the attached rubric and complete Assignment 2. The rubric lists the problems  that you need to solve and provides specific information about what you need to provide in your answers and the points …

The question/problem due this week is a case study worth 40 points:
Case 12-1 (page 391) – Research Project: How CPA Firms are Leveraging New Developments in IT.  Do an online search to find any relevant article or source explaining how CPA firms are using IT developments (e.g., the cloud, mobile, etc.). Write a brief essay (1 – 2 pages) summarizing the benefits of the new technology (cost reduction, revenue increases, customer attraction and retention, etc.) and how the firm might mitigate any new threats associated with that technology.
Submit your assignment in a Word file upload.

Marker’s Tattoo Studio wants to buy new laser therapy equipment. This new equipment would cost $300,000 to purchase and $20,000 to install. Marker’s estimates that this new equipment would yield incremental margins of $98,000 annually due to new client services. It would require incremental cash maintenance costs of $10,000 annually. Marker’s expects the life of this equipment to be 5 years. They estimate a terminal disposal value of $20,000.
Marker’s has a 25% income tax rate and depreciates assets on a straight-line basis (to terminal value) for tax purposes. The required rate of return on investments is 10%.
Determine the expected increase in annual net income from investing in the new equipment. Calculate the accrual accounting rate of return based on average investment. Summarize whether the new equipment is worth investing in from a net present value (NPV) standpoint. Suppose that the tax authorities are willing to let Marker’s depreciate the new equipment down to zero over its useful life. If Marker’s plans to liquidate the equipment in 5 years, should it take this option? Quantify the impact of this choice on the NPV of the new equipment.

You are retained by Columbia Corporation to audit its financial statements for the fiscal year ended June 30. Your consideration of internal control indicates a fairly satisfactory condition, although there are not enough employees to permit an extensive separation of duties. The company is one of the smaller units in its industry, but it has realized net income of about $500,000 in each of the last three years.
Near the end of your fieldwork, you overhear a telephone call received by the president of the company while you are discussing the audit with him. The telephone conversation indicates that on May 15 of the current year, the Columbia Corporation made an accommodation endorsement of a 60-day $430,000 note issued by a major customer, Brill Corporation, to its bank. The purpose of the telephone call from Brill was to inform your client that the note had been paid at the maturity date. You had not been aware of the existence of the note before overhearing the telephone call. 
From an ethical standpoint, do you think the auditors would be justified in acting on information acquired in this manner? 
Should the balance sheet as of June 30 disclose the contingent liability? Give reasons for your answer. 
Prepare a list of auditing procedures that might have brought the contingency to light. Explain fully the likelihood of detection of the accommodation endorsement by each procedure listed.