Who will be negatively impacted if you do comply

Assignment Help Accounting Basics
Reference no: EM132185084

Question: Instructions: • Read the following scenario.

• Answer the questions that follow.

• This is an example of how this assignment should be done:

1. What is the accounting problem that the Linbarger Company faces?

Answer:

Scenario: Imagine you are the assistant controller in charge of general ledger accounting at Linbarger Company. Your company has a large loan from an insurance company. The loan agreement requires that the company's cash account balance be maintained at $200,000 or more, as reported monthly. At June 30, the cash balance is $80,000. You give this update to Lisa Infante, the financial vice president. Lisa is nervous and instructs you to keep the cash receipts book open for one additional day for purposes of the June 30 report to the insurance company. Lisa says, "If we don't get that cash balance over $200,000, we'll default on our loan agreement. They could close us down, put us all out of our jobs!" Lisa continues, "I talked to Oconto Distributors (one of Linbarger's largest customers) this morning. They said they sent us a check for $150,000 yesterday. We should receive it tomorrow. If we include just that one check in our cash balance, we'll be in the clear. It's in the mail!"

1. What is the accounting problem that the Linbarger Company faces?

2. What are the ethical considerations in this case? Provide rationale for why these are ethical considerations.

3. What are the negative impacts that can happen if you do not follow Lisa Infante's instructions to wait one more day to post the balance?

4. Who will be negatively impacted if you do comply? Provide a rationale for why these individuals will be impacted.

5. What is one alternative that you could pursue in this scenario? Support your recommendations with information you learned in this class.

Reference no: EM132185084

Here are simplified financial statements phone corporation

Calculating Ratios. Here are simplified financial statements of Phone Corporation from a recent year: 1 Calculate the following financial ratios: Long-term debt ratio. Total d

Journal entries to record the requisition slips

Prepare summary journal entries to record the requisition slips, time tickets, the assignment of manufacturing overhead to jobs, and the completion of Job No. 329. Show comput

Premiums paid for group term life insurance

In arriving at the $270,000 of partnership profits, the partnership deducted $2,400 ($800 for each partner) in premiums paid for group term life insurance on the partners.

Annual adjusting entry

Upland Company borrowed $40,000 on November 1, 2010, by signing a $40,000, 9%, 3-month note. Prepare Upland’s November 1, 2010, entry; the December 31, 2010, annual adjusting

Ending balance in manufacturing overhead account

During the month, direct materials amounting to $20,000 and indirect materials amounting to $5,000 was issued to production. What is the ending balance in the manufacturing

Environmental attorney for raymond

In May of 2009, Raymond Financial Services became involved in a penalty dispute with the EPA. At December 31, 2009, the environmental attorney for Raymond indicated that an

Contribution margin for the current and projected year

Compute (1) the contribution margin for the current and the projected year, and (2) the fixed costs for the current year. (Assume that fixed costs will remain the same in th

An investment heavy in stocks produces the best results

The simulation output from Example 11.7 indicates that an investment heavy in stocks produces the best results. Would it be better to invest entirely in stocks? Answer this

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd