Advise as to the liability of all the parties
Course:- Cost Accounting
Reference No.:- EM13391

Assignment Help
Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Cost Accounting

Andrew, Brian, Colin, Diana and Elizabeth were the directors of Gemsales Pty Ltd, a company engaged in the business of importing and supplying jewellery as wholesalers to the local market.

The company decided that as the market was becoming more competitive it needed to expand its business as it felt with increased volumes of sales it would be able to lower its prices and be more competitive. In order to do so it obtained a $4 million dollar loan from the Friendly Bank Ltd. $3 million was used to buy more stock and $1 million was used to buy a large new warehouse and showrooms from Traders Pty Ltd.Six months later, Brian resigned as a director. At the same time it was clear the company had over-extended itself and was insolvent and could not pay the interest on its loans.

It also became clear that Brian was a major shareholder in Traders Pty Ltd and the other directors were unaware of this at the time of the purchase of the warehouse and showrooms. Furthermore, Brian had been approaching other established customers of Gemsales Pty Ltd and had secured orders for his own business.

Write a report on given case study and Advise as to the liability of ALL the parties both under common law and the Corporations Law.

  • Problem Identification
  • Discussion and Analysis
  • Breaching of Duties
  • Solution
  • Conclusion
  • Peferences

Word count: 2000

Reference style : Harvard referencing style

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Cost Accounting) Materials
Respond to assertions by the IRS and counter those assertions with your own and make a convincing argument that information/documentation your client possesses justifies and s
The overhead costs that Sife Industries, Inc., used to compute its overhead rate for the past year are as follows. Compute the past year's overhead rate. Compute the overhe
Compute the activity rate (i.e., predetermined overhead rate) for each activity cost pool. (Do not round intermediate calculation. Round your final answers to 2 decimal plac
Prepare general journal entries to account for the capital contributed by the partners. Include narrations and prepare a statement of financial position on the day of formatio
Complex Job costing information using equivalent units. The Custer Manufacturing Corporation, which uses a job order cost system, produces various plastic parts for the airc
Identify the activities in the doctor's office that fall into process time, inspection time, move time, wait time, and storage time. Explain why you classify them as non valu
key provisions of the Sarbanes-Oxley Act of 2002. Order your list from most important to least important in terms of the likely long-term impact on the accounting profession
What amount of the current cost per unit is attributable to non-value-added activities? Calculate the new target cost per unit for a sales price of $800 if the profit per unit