Premium Essay

Accounting Case

In:

Submitted By saragotham
Words 655
Pages 3
Case 3.1: While in Napal, McCoy describes his experiences with Sadhu on the mountainside as a breakdown of ethics on the corporate and individual level; in this comparison the hiking party would be the institution and Sadhu the individual. With that said typically speaking individuals within a firm may find their needs overwhelmed and under recognized as the specific interests of the firm itself are at the fore front. Again this correlates to the treatment of Sadhu by the hikers on the trip. With respect to the Ethical Dissonance Model the incident in question can be classified as low ranking concerning the corporate and individual ethics model. In short each hiker justified their actions as doing what they could to assist Sadhu, but in essence each hiker passed the safety and responsibility of Sadhu to the next hiker, rather than ensuring the gentlemen’s wellbeing through until the end. It became apparent that each hiker was concerned about their own self-interests rather than the interests and wellbeing of Sadhu. McCoy reached stage two in Kohlberg’s Stages of Moral Development. He wanted to satisfy his own needs of fulfilling his dream of completing this hike and making it to the holy shrines. He felt that his responsibilities with the Sadhu were complete after he helped to get him clothed and checked that he was still alive, so he continued on his hike. Stephen made it to stage 3, fairness to others. He felt that he had an obligation to make sure that the Sadhu was taken care of and got to the village safe. He tried to help him out as best as he could while getting resistance for his guides. The bystander effect was somewhat in play in McCoy’s and the others actions. They all did try to help out but not as much as they could have. They all hoped that the next person would take over and relieve them of the burden. Ethical fading

Similar Documents

Premium Essay

Accounting Case

...Seligram, Inc.: Electronic Testing Operations 1. What caused the existing system at ETO to fail? 2. Calculate the reported cost of the five components listed in Exhibit 6 using: a. The existing system. b. The system proposed by the accounting manager. c. The system proposed by the consultant. 3. Which system is preferable? Why? 4. Would you recommend any changes to the system you prefer? Why? 5. Would you treat the new machine as a separate cost center or as a part of the main test room? Bridgeton Industries: Automotive Component & Fabrication Plant 1. The official overhead allocation rate used in the 1987 model year strategy study at the Automotive Component and Fabrication Plant (ACF) was 435% of direct labor cost. Calculate the overhead allocation rate using the 1987 model year budget. Why do you get different numbers? 2. Calculate the overhead allocation rate for each of the model years 1988 through 1990. Are the changes since 1987 in overhead allocation rates significant? Why have these changes occurred? 3. Consider two products in the same product line: Product 1 Product 2 Expected Selling Price $62 $54 Standard Material Cost 16 27 Standard Labor Cost 6 3 Calculate the expected gross margins as a percentage of selling price on each product based on the 1988 and 1990 model year budgets, assuming selling price remains constant and material/labor costs do not...

Words: 1915 - Pages: 8

Premium Essay

Accounting Case

...1. How many of its common shares is Merck authorized to issue as of 12/31/11? Merck authorized 6,500,000,000 shares. 2. How many of its common shares has Merck actually issued as of 12/31/11? Merck issued 3,576,948,356 shares. 3. How many of its common shares does Merck hold in its treasury as of 12/31/11? 536,109,713 shares 4. How many of Merck’s common shares are outstanding as of 12/31/11? 3,040,838,643 shares 5. How many of its shares did it repurchase during 2011? 58,000,000 shares 6. How much per share, on average, did Merck pay to buy back its stock in 2011? Price per share = 1,921,000,000/58,000,000= $33.12/share 7. Why doesn’t Merck treat its Treasury Stock as an asset on its balance sheet? Briefly explain. Merck's Treasury Stock is not an asset account. It is Merck’s own stock. Merck buys it back to reduce its outstanding stock available on the market. Merck can not legally invest in its own stock and can not make profit from its own stock. It is considered as a contra equity account that reduces shareholder equity on the balance sheet. 8. How much did Merck declare during 2011 in dividends to its common shareholders? $4,818,000,000 9. How much did Merck pay during 2011 in dividends to its common shareholders? $4,691,000,000 10. Record the summary journal entry that Merck would make for its common stock dividend activity during 2011...

Words: 291 - Pages: 2

Premium Essay

An Accounting Case

...SHEPPARD’S Accounting game 1: Deyonne’s assets: 1. 400 sheep 2. 20 acres of land 3. A one-room cabin 4. A plow 5. Two carts 6. An ox Deyonne’s liabilities and deduction of assets: 1. 35 sheep 2. 3 sheep Due to the information, 20 acres of land equal 80 sheep according to the exchange rate of last year, a one-room cabin equal 3 acres of land and equal 12 sheep finally, a plow equals 2 goat and equal 2/3 sheep according to last year’s exchange rate and 2 carts which were traded with a poor acre of land equals 8 sheep plus 400 sheep. So Deyonne’s total assets are 500(2/3) sheep. Deyonne’s liabilities and assets deduction are 35 sheep plus 3 sheep, which will come to 38 sheep, therefore, his total net assets are 462(2/3) sheep. Batonne’s assets: 1. 360 sheep 2. 30 acres of land (which were trade with 35 sheep 10 years ago) 3. 10 acres of land (which were trade current year) 4. 10 goats ( 3 goat equals 1 sheep according to last year’s price) 5. An ox ( equals 3 sheep) 6. A two-room cabin (worth 3 acres of land) Explanations: 1. Although Batonne obtained 20 acres of land 10 years ago with 35 sheep, the worth of land increased to 4 sheep per acre of land. So all the land should be converted to sheep according to this later price. 2. There is no exchange price for the poor land, so it is assumed that the price for poor land is also 4 sheep per acre of land. 3. Because the...

Words: 599 - Pages: 3

Premium Essay

Accounting Case

...We have been asked by the directors of Belamy Corporation (BC), a company owned by Lipopro Inc (LI) which produces patented medicines, to give advice as to the potential financial reporting implications of the various alternatives for acquiring Caligon Inc (CI). CI is a wholly owned pharmaceutical subsidiary of Davison Corporation (DC), which has recently been de-emphasizing its own research efforts in favor of licensing products from other companies. BC is looking to acquire a pharmaceutical company such as CI to which it will transfer existing licensed products as the current licensing agreements expire. Through the analysis of three alternative acquisition arrangements, BC will gain an understanding of all possible implications and will be able to make decisions accordingly. These three alternatives must each be accounted for as business combinations, which occur when there is a transaction in which the acquirer obtains control of one or more business. In each alternative, BC would acquire control of CI, which can be seen through BC’s rights to their returns as well as having the ability to affect these returns with the power held in the business. Alternative 1 suggests a share for share exchange in which BC issues new shares totaling 40% of outstanding shares for 100% of the shares of CI. Since the acquirer is issuing its own shares as consideration transferred, we must determine the fair value of these shares using the current trading value of $25. For the 7 200 000...

Words: 1150 - Pages: 5

Premium Essay

Cost Accounting Case Study

...Number 3 121 Cost Accounting In Auto Manufacturing Companies In Germany And The United States Robert Jinkens, USA RamMohan R. Yallapragada, Fayetteville State University, USA ABSTRACT Corporate accountants are mandated to prepare and distribute financial accounting reports for external U.S.ers at end of each accounting period. However, there are no similar statutory requirements for corporate accountants to provide managers of their companies with the management accounting information necessary for decision making in their bU.S.iness operations. Cost accounting is an important integral part of management accounting. Product costing has always been a much debated issue in management accounting. The area that has generated a host of conflicting views is the allocation of overhead costs to products. Traditional absorption costing is claimed to be resulting in an unfair allocation of overhead costs to products. New approaches such as the Activity Based Costing (ABC) did not receive widespread adoption. It is being realized in management accounting field that an emerging costing method known as Resource Consumption Accounting (RCA) is a better method for product costing. It is a method adopted by the German manufacturing companies. This paper describes the German cost accounting method and also compares the German cost accounting with the cost accounting in the United States, specifically in the automobile manufacturing indU.S.try. Keywords: Cost Accounting in auto manufacturing...

Words: 3637 - Pages: 15

Premium Essay

Accounting Case Study

...John Duffy Dr. Shahid ACC 302-03 March 14, 2011 Chapter 18 Case Discussion Questions, Part 1. 1. When judging whether MiniScribe’s revenue recognition practices were consistent with GAAP, Reggie Lewis should have reviewed Section 605 of the Accounting Standards Codification concerning everything surrounding revenue recognition. More specifically ASC 605-25-1 states that, “The recognition of revenue of an entity during a period involves consideration of the following two factors, being realized or realizable and being earned.” In terms of revenue realization, FASB Concepts Statement No. 5 states that, “revenue is realized when products, merchandise or other assets are exchanged for cash or claims to cash.” In MiniScribe’s case, by booking sales when goods are shipped to the warehouses rather then when they were shipped to customers to increase sales, they were not following the Accounting Standards Codifications guidelines of reporting revenues when earned. Based on these documents Reggie, and not his superior, is right to question the practices of MiniScribe in their effort to increase sales. 2. Reggie is in an extremely tough position. While his superior’s main goals are to increase sales, Reggie should realize as a worker in the company that the goal should be to increase sales ethically and by the rule book. Although his superiors may not want to hear it, Reggie should tell them about their faulty practices in reporting revenue. Although his boss may see this...

Words: 670 - Pages: 3

Premium Essay

Case for Accounting Class

...INTRODUCTION Revenue recognition is one of the top causes for financial statement restatements. In addition, revenue recognition is an area commonly questioned by the Securities and Exchange Commission (SEC) staff in their review of public filings and resultant comment letter process. Furthermore, revenue recognition is often prey to financial fraud. Coverage of revenue recognition in intermediate accounting courses is typically limited to learning and applying the criteria for revenue recognition outlined in the Financial Accounting Standards Board’s (FASB) Statement of Financial Accounting Concepts No. 5, Recognition and Measurement in Financial Statements of Business Enterprises, to routine transactions and topics, such as long-term construction contracts and installment sales (FASB 1984). While these topics are important, there are literally hundreds of revenue-generating transactions that are not covered in the traditional financial accounting sequence. These are their stories (for any Law and Order fans): Case One: Facts Consumer Cleaning Products Corporation (CCPC) is a public company with a calendar yearend. CCPC manufactures detergent that is ultimately purchased (and used) by consumers. The supply chain consists of the following: * CCPC sells its detergent to a wholesaler; * The wholesaler sells the detergent to a retailer; and * The retailer sells the detergent to a consumer. CCPC launches a new detergent, Fresh & Bright, on September...

Words: 1413 - Pages: 6

Premium Essay

Accounting Research Case

...ACC 310 Fall 2013 Research Case Two 1. International Financial Reporting Standards, abbreviated “IFRS”, are a set of high quality, understandable, enforceable, and globally accepted rules for companies to use all over the world. These IFRS are permitted or required in around 120 countries. Companies, securities regulators, investors, creditors, and other business people alike prefer to have comparable financial statement information when making business transaction internationally. IFRS presents a solution to this problem. These standards are set by the International Accounting Standards Board (IASB). Consisting of 16 members from various countries, the IASB structure is similar to that of the FASB in that they have a parent organization entitled the IFRS Foundation (Accounting Textbook, 1-17). The phrase “International Convergence of Accounting Standards” refers to both a goal and the path that is necessary to achieve it. Ultimately, the FASB would to like to be able to provide a unified set of superior quality, international accounting standards that companies worldwide would implement for both domestic and cross-border financial reporting, thus accomplishing convergence. However, until that time, FASB is committed to working with other accounting standard setting bodies to help to eventually develop a converged system without compromising quality (fasb.org). 2. Perhaps one of the most convergence hindering differences between IFRS and U.S. GAAP is the way in...

Words: 1243 - Pages: 5

Free Essay

Accounting Ethic Case

...Case analysis 3 Chao Yao Major case 1 Adelphia Communications Corporation 1. What are the facts? In September 2005, the SEC charged Dearlove, a certified public accountant and formerly a partner with the accounting firm Deloitte& Touche LLP, with the improper conduct resulting in a violation of applicable professional standards. On July 24, 2009, the U.S. Court of Appeals for the District of Columbia supported the finding of the SEC that Dearlove engaged improper professional conduct. SEC found that Adelphia’s financial statements were not in accordance with the general accepted accounting principles and Dearlove violated general accepted auditing standards. The Adelphia communications Corporation was one of the largest cable television companies in the United States. Prior to 2000, the SEC found large amount Co-borrowed debt inside the company and its affiliated entities. After the big Enron scandal, SEC required public company to disclose the related-party transactions. As Adelphia disclosed its obligations as co-debtor with the Rigas entities, the stoke price of company declined sharply and finally was delisted from the NASDAQ. 2. What are the ethical issues? Dearlove had engaged in unreasonable conduct, such as approval of the Adelphia’s method of accounting for related-party transactions. His behaviors resulted in a violation of applicable professional standards. Deloitte, who engaged in auditing Adelphia, did not issued a fair auditor’s report. Adelphia...

Words: 2199 - Pages: 9

Premium Essay

Case Issues - Accounting

...IFRS/ASPE are the new accounting standard and must be used when discussing all accounting issues. Although the case mentioned GAAP, you learned in class that IFRS was to be used. Going forward, discuss the case using IFRS/ASPE, even if the case says GAAP. • A lot of students missed mentioning that an unqualified audit opinion was needed; this was a constraint in the case. • The required in this case was to “provide advice about terms that should be included in the sale agreement to minimize the risks to Mr. Jones of being affected by accounting choices made by the new owner of the company”. Therefore, you are to write the case from the perspective that the new owner would make accounting choices that would not be fair to Mr. Jones, and to conclude on what is FAIR. • When discussing users and objective, make sure that you conclude on the primary user and objective. Also, make sure you are discussing users based on what is asked of you in the case. This case asked for advice on terms to be included in the sale agreement to minimize the risks to Mr. Jones; therefore, Mr. Jones is the primary user. Since Angela requested this case, she is also the main user. The buyer, CRA, auditor, etc. are not relevant users for this advice. • When discussing the new equipment purchase, a lot of students did not discuss the amortization policy that is to be used. This is an important issue within capital assets and it is especially important in this case as a different policy...

Words: 464 - Pages: 2

Premium Essay

Accounting Case Study

...Accounting Case Study John Duffy Dr. Shahid ACC 302-03 March 14, 2011 Chapter 18 Case Discussion Questions, Part 1. 1. When judging whether MiniScribe’s revenue recognition practices were consistent with GAAP, Reggie Lewis should have reviewed Section 605 of the Accounting Standards Codification concerning everything surrounding revenue recognition. More specifically ASC 605-25-1 states that, “The recognition of revenue of an entity during a period involves consideration of the following two factors, being realized or realizable and being earned.” In terms of revenue realization, FASB Concepts Statement No. 5 states that, “revenue is realized when products, merchandise or other assets are exchanged for cash or claims to cash.” In MiniScribe’s case, by booking sales when goods are shipped to the warehouses rather then when they were shipped to customers to increase sales, they were not following the Accounting Standards Codifications guidelines of reporting revenues when earned. Based on these documents Reggie, and not his superior, is right to question the practices of MiniScribe in their effort to increase sales. 2. Reggie is in an extremely tough position. While his superior’s main goals are to increase sales, Reggie should realize as a worker in the company that the goal should be to increase sales ethically and by the rule book. Although his superiors may not want to hear it, Reggie should tell them about their faulty practices in reporting revenue. Although his...

Words: 328 - Pages: 2

Premium Essay

Accounting Case - Ayrglen

...To: Alan and Bart Ayr From: W&T Accounting LLP Re: Revision of AyrGlen Context: From what you have described, there are four main users of the financial statements; the shareholders (Alan, Bart and David), the bank, and the tax revenue agency. As stated in your note to us, you wantto defer as much tax as possible so a reduction in net income before taxes is preferable. However, this presents a conflicting objective with the bank who might want to see a high net income, but more likely a high cash flow from operations because they want to ensure that AyrGlen is generating cash from normal operation and therefore in a good financial position to pay off the large debt. Nonetheless, the overriding objective is to minimize taxes so that taxes expense and taxes payable would be reduced, which means more cash on hand which will be beneficial in the eyes the bank officer and help maintain AyrGlen’s high credit rating. AyrGlen faces one main constraint on their financial statements. Due to the fact that the bank requires audited statements therefore AyrGlen must follow GAAP. I have identified several issues with the company’s policies that may obstruct the company from reaching this goal. Collection of Payment and Revenue Recognition: The collection policy of 60 days after the goods have been delivered to the customerswill harm the company’s cash flow. Under the assumption that the majority of the customers would pay near the end of the 60 day grace period, AyrGlen...

Words: 1297 - Pages: 6

Premium Essay

Cost Accounting Case Study

...1. Executive Summary This report covers on the central problem the business encounters and offer solutions to reconstruct certain facets of the business. The main concern that Cambden Cakes faced is the inaccuracy of the method of costing used which results in a misstatement in its profit report. This report is to offer an alternative to the current costing method - Activity-Based Costing (ABC). The following detailed explanatory will be covered in the main body  Limitations of original costing system and how ABC system overcome the limitations mentioned;  The benefits of ABC system to the company;  Comparison of calculated values and differences between the two methods; and lastly  The implementation of ABC system and its issues 2. Background on Cambden Cakes Business in Cambden Cakes includes manufacturing and distributing of a variety of cakes and pastry products to supermarkets which are located all over Victoria, Australia. It has a factory in Clayton, Melbourne, Australia which both manufacturing and distributing process occurred, followed by delivery to Cambden Cakes' customers' warehouses which then send out to supermarket outlets. Chris Lee is Managing Director of Cambden Cakes. He showed keen interest in expanding the business and followed up on the interest by modernizing the manufacturing processes in the factory. This result in a shift from being labour-intensive in its original manufacturing...

Words: 1445 - Pages: 6

Premium Essay

Accounting Text and Cases

...UNIVERSITAS INDONESIA ACCOUNTING CHAPTER 5 Group 4 Muhammad Fariz Haikal 1206334291 Mutia Imro Atussoleha 1206334303 Shervani Andita P. 1206334594 Magister Management Fakultas Ekonomi Universitas Indonesia Jakarta 2013 Problem 5-4 As Of 31 Dec A/R =750.000 AFDA=37.500 Days Account Outstanding|Amount|Expected Percentage Uncollectible*|Estimated Uncollectible| 0-15 days|$450,000|0.01|$ 4,500| 16-30 days| 150,000|0.06| 9,000| 31-45 days| 75,000|0.20| 15,000| 46-60 days| 45,000|0.35| 15,750| 61-75| 15,000|0.50| 7,500| Balance for Allowance for Doubtful Accounts|$51,750| *(1-Probability of collection.) Days Account Outstanding > 75 days, has amount = $15,000, Expected Precentage Uncollectible=0% would be written off immediately and not be considered when determining the proper amount of the Allowance for Doubtful Accounts. b. Account Receivable|$735,000| Allowance for Doubtful Accounts.|$ 51,750| Net Accounts Receivable|$683,250| * Account Receivable= $750000 - $ 15.000 = $735.000 c. The year-end bad debt adjustment would decrease the year’s before-tax income by $29,250, as shown below: Estimated amount required in the Allowance for Doubtful Accounts|$51,750| Balance in the account after write-off of bad accounts but before adjustment|$22,500| Required charge to expense|$29,250| *$22500=$37500(Allowance for Doubtful Accounts ) -$15000 (Bed Debt Expense) ...

Words: 799 - Pages: 4

Premium Essay

Management Accounting Case Study

...9-40 Make or Buy; Strategy; Ethics (45 min) 1. An analysis of per unit and total costs for 32,000 units shows that the Midwest Division should purchase the parts for a saving of $15,440 ($575,040 - $559,600). Cost per unitTotal CostCost to purchase MTR-2000 from Marley Bid price from Marley$17.30$553,600 Equipment lease penalty [($36,000/12)x2]6,000Total cost to purchase$559,600 Cost for Midwest to Make MTR-2000 Direct material ($195,000/30,000)x1.087.02$224,640 Direct labor ($120,000/30,000)x1.054.20134,400 Factory space rental ($84,000/32,000)2.62584,000 Equipment leasing costs($36,000/32,000)1.12536,000 Variable manufacturing overhead3.0096,000Total cost to make$17.97$575,040 2. At least three strategic factors that the Midwest Division and Paibec Corporation should consider before agreeing to purchase MTR-2000 from Marley Company include the following: The quality of the Marley component should be equal to, or better than, the quality of the internally made component, or else the quality of the final product might be compromised and Paibec's reputation affected. Marley's reliability as an on-time supplier is important, since late deliveries could hamper Paibec's production schedule and delivery dates for the final product. Layoffs may result if the component Is outsourced to Marley, This could impact Midwest's and Paibec's other employees and cause labor problems or affect the company's position in the community, In addition, there may be termination...

Words: 491 - Pages: 2