Reference no: EM132381168
Assignment: Ethics in Accounting
Effective financial reporting depends on sound ethical behavior. Financial scandals in accounting and the businesses world have resulted in legislation to ensure adequate disclosures and honesty and integrity in financial reporting. A sound economy is contingent on truthful and reliable financial reporting.
Instructions: • Read the following scenario.
• Answer the questions that follow. Your answers should result in a 3 page submission.
• Reference back to your textbook for guidance on how to think through the scenario.
• This course requires the use of new Strayer Writing Standards (SWS). The format is different from other Strayer University courses. Please take a moment to review the SWS documentation for details.
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 a 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 the information you learned in this class.
|
Exploratory modelling and analysis
: Perhaps the most doubtless way to implement a policy is through informed decision making. Smart cities are being developed even as we speak.
|
|
Using ebit-eps? break-even analysis
: Home? Depot, Inc.? (HD), had 1244 million shares of common stock outstanding in? 2016, whereas Lowes? Companies, Inc
|
|
Analyzing coverage? ratios
: The income statements for Home? Depot, Inc.? (HD), spanning the period? 2014-2016 (just before the housing? crash, so these are representative? years) are found
|
|
What is the company cost of common equity
: A company issues common equity and has a beta of 1.5. The risk free return is 3% and the market return is 7%. What is the company's cost of common equity?
|
|
Who will be negatively impacted if you do comply
: Who will be negatively impacted if you do comply? Provide a rationale for why these individuals will be impacted. What is one alternative that you could pursue.
|
|
What is the internal growth rate
: If the profit margin, total asset turnover, and dividend payout ratios remain unchanged, what is the internal growth rate it can achieve
|
|
What is the interest rate on offer
: A retail store is offering a diamond ring for sale for 36 months at $120 per month. The retail price of the ring is $3,900.
|
|
Developing a new product
: Your company just spent $10 million developing a new product - the Aaron Rodgers bobble-head toy - and you have to decide whether or not to launch the product.
|
|
Axiomatic Derivations Problems - Prove Proposition
: Axiomatic Derivations Problems - Prove Proposition. Show that the following hold by exhibiting derivations from the axioms
|