e company should purchase an expensive new machine from Radi Ltd, where her brother is the new sales manager. Asma did not tell anyone in Flower Cloth about her brother’s new job. In preparing her report, Asma overstates the qualitative benefits and understates the costs associated with this new machine to help her brother make his first s
Q: Wharton Associates is a recently formed law partnership. Denise Peyton, the managing partner of…
A: There are several types of costs that are used by the firm (Bradley Associates) like indirect cost…
Q: Cecelia, a human resources manager, is working on an ethics policy for the company she works for.…
A: Ethical behavior: It implies to the application and adherence to the moral principles and values in…
Q: Mohammed was recently interviewed for an accounting job. His employer told him that the job…
A: Management accounting is a branch of accounting in which accounting and financial information is…
Q: g about any other aspect of the business except for the ironing function she plays. She has however…
A: Introduction:- Venture capital is a private equity and a type of financing and raises funds in which…
Q: For which of the following reasons would David Laugherty, owner of the Laugherty Associates law…
A: Job Order Costing: The job order costing is a method of cost accounting. Under this method, costs…
Q: Imagine you are a manager. Your company has an opportunity to venture out into a new market with a…
A: Discontinued operations states the parts of the company core product line which have been divested…
Q: Patrick Financial Services, an accounting firm, specialises in providing accounting and taxation…
A: Analysis of Financial Information The purpose of providing the financial information to share the…
Q: needs help defining the costs for his business. Frank also wants to know which costs are relevant or…
A: Relevant cost: relevant cost is the cost which is relevant for decision making, it is relevant to…
Q: Assume you are a newly appointed accountant in a local fashion Company named Al Rahim clothing…
A: Accounting standards are set of rules that provide guidance for recording accounting information…
Q: You have just made it to Manager at a mid-sized accounting firm. You have always wanted to…
A: Client Senior Partner Hours Senior Partner Billing Rate Per Hour Total Charges for Senior Partner…
Q: Ella Maksimov is CEO of her own marketing firm. The firm recently moved from a strip mall in the…
A: The relevant cost in a decision making include those cost which would entail additional outflow of…
Q: (1) What are some key differences between financial and managerial accounting?
A: Hi student Since there are multiple questions, we will answer only first question.
Q: Directions: For each situation, select one option you think will help increase profit. Put the…
A: There are various means to attract the customer. Also the company takes various steps to decrease…
Q: Making ethical decisions Sue Peters is the controller at Vroom, a car dealership. Dale Miller…
A: Ethical decision S P should discuss the situation with an objective supervisor or immediate…
Q: Asma is a junior management accountant at Flower Cloth Ltd. Asma is given the task of compiling a…
A: Standards of ethical conducts: Standards of ethical conducts can be defined as the standards that…
Q: 15 Assume, Mr X is appointed as an auditor in XYZ Company. He intends to determine how well the…
A: Audit procedures are the procedures performed by the auditor during the audit engagement…
Q: Ethics and quality. Weston Corporation manufactures auto parts for two leading Japanese automakers.…
A:
Q: Ellie Ice-cream’s owner is disturbed by the poor profit performance of his ice cream counter. He has…
A: Relevant cost are the avoidable costs that can be avoided with the elimination of some product usage…
Q: Assume you are a newly appointed accountant in a local fashion Company named Al Rahim clothing…
A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: 1. Managerial accountants have the responsibility to: а. accept gifts or hospitality that may allow…
A: Answer 1 : d Answer 2 : b Answer 3 : b
Q: Assume you are a newly appointed accountant in a local fashion Company named Al Rahim clothing…
A: Assuming i have been appointed as a accountant in a local fashion company. In any company there will…
Q: I have attached the file. Please help me with the solution.
A: The direct material cost per unit is $4.72 which is higher than flexible budget of $4.50.The actual…
Q: Asma is a junior management accountant at Flower Cloth Ltd. Asma is given the task of compiling a…
A: Standards of ethical conducts can be defined as the standards that should be followed by the members…
Q: Tana Thorne works in a public accounting firm and hopes to eventually be a partner. The management…
A: Audit: Audit is the process of verification of the compliance of the financial statements. It…
Q: Prepare a 1-2 page double spaced memo to the company president, David Morgan (a former top…
A: Answer - Working - Particulars Calculation Amount First Allocation 1st half of fixed…
Q: Ethics and quality. Weston Corporation manufactures auto parts for two leading Japanese automakers.…
A:
Q: Prepare a 1-2 page double spaced memo to the company president, David Morgan (a former top…
A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: Making outsourcing decisions Priscilla Smiley manages a fleet of 250 delivery trucks for Daniels…
A: Differential analysis: Differential analysis is a cost analysis method in which two or more…
Q: Mohammed was recently interviewed for an accounting job. His employer told him that the job…
A: Financial accountant is a person who use to prepare books of accounts and management accountant is a…
Q: Requirement 2. For each decision, select what information the management accountant can provide…
A: Management accounting is the branch of accounting which records, analyse, and summarise the…
Q: Jan Harry, a mechanical engineer, was informed that she would be promoted to assistant factory…
A: In this question we are require to distinct between financial and management accounting. Lets us…
Q: Making decisions about dropping a product Members of the board of directors or Security Check have…
A:
Q: aifi halwa is running a successful business in Nizwa. They are supplying halwa to different…
A: Non productive work is the work done within the organization which does not provide production but…
Q: CASE: Outsourcing Accounting Functions You have been employed for two years in the accounting…
A: Benefits that an organization might gain from basic accounting functions: 1. Time-Saving: After a…
Q: Pizza Capers: Business Improvement The Situation: Pizza Capers Burpengary is a not-for-profit pizza…
A: Labor cost is the cost which has been incurred by the company on the employees means the benefits…
Q: Uses of managerial accounting in a service company Priceline.com allows customers to bid on hotel…
A: Managerial Accounting in the service industry:The company providing services to the society, need to…
Q: David Kelley is considering the implementation of an incentive wage plan to increase productivity in…
A: Definition and Goal Accomplishment Plan:Incentive wage is the income earned by the employees in case…
Q: Which of the following would constitute an Agency Problem in the context of Business? Check all of…
A: An agency problem is a conflict of interest between an agent and a principal. An agent can be an…
Q: Mohammed was recently interviewed for an accounting job. His employer told him that the job…
A: Financial accountant is a person who use to prepare books of accounts and management accountant is a…
Q: QUESTION 1 Ashby Associates is an architectural fim located in Barbados that has been in practice…
A: Answer i. Ashby Associates’ strategy for 2019 is cost leadership. Ashby Associates is trying to grab…
Q: Desiree is a successful sole practitioner offering business consultancy services to a number of…
A: Business entity refers to the organization created by individual or group of individuals to conduct…
Q: Ethics and quality. Weston Corporation manufactures auto parts for two leading Japanese automakers.…
A:
Q: According to the 2011 National Business Ethics Survey conducted by the Ethics Resource Center,…
A: Answer: Workplace ethics is the ethical behavior that an employee is expected to follow during his…
REQUIREMENT: Ethical behaviour for managers and
Question
Asma is a junior management accountant at Flower Cloth Ltd. Asma is given the task of compiling a cost-benefit analysis report on whether the company should purchase an expensive new machine from Radi Ltd, where her brother is the new sales manager. Asma did not tell anyone in Flower Cloth about her brother’s new job. In preparing her report, Asma overstates the qualitative benefits and understates the costs associated with this new machine to help her brother make his first sales as the new sales manager.
Required:
Discuss why and how Asma has deviated from the standards of ethical conduct.
Step by step
Solved in 2 steps
- Assume you have been hired by Cabelas Sporting Goods. As part of your new role in the accounting department, you have been tasked to set up a responsibility accounting structure for the company. As your first task, your supervisor has asked you to give an example of a cost center, profit center, and an investment center within the Cabelas organization. Your supervisor is a little unsure of the difference between a profit center and investment center and would like you to explain the difference.Ethics and professional conduct in business Erin Haywood was recently hired as a cost analyst by Wind River Medical Supplies Inc. Oneof Erin’s first assignments was to perform a net present value analysis for a new warehouse.Et-in performed the analysis and calculated a present value index of 0.8. The plant manager.ZuhairBarbat, is very intent on purchasing the warehouse because he believes that more storage space is needed. Zuhair asks Erín into his office and the following conversation takes place: ZubairErín, you’re new here, aren’t you? EHii: Yes, sir. Zubair: V.dl, Erin, let me tell you something. ¡m not at all pleased with the capital investment analysis that you performed on this new warehouse. T need that warehouse for my production. If I dont get it, where am I going to place our output? Erín: Hopefully with the customer, sir. Zithair: Now don’t get smart with me. Erín: No, really. I was being serious. My analysis does not support constructing a new ware- house. The numbers don’t lie: the warehouse does not meet our investment return targets. In fact, it seems to me that purchasing a warehouse dots not add much value to the business. We need to be producing product to satisfy customer orders, not to fill a warehouse. Zubair Listen, you need to understand sonwthing. The headquarters people will not allow mv to build the warehouse if the numbers dont add up. You know as well as I that many assump tions go into your net present value analysis. Why don’t you relax some of your assumptions so that the f́nancial savings will offset the cost? Erín: I’m willing to discuss my assumptions with you. Maybe I overlooked something. Zubafr Good. Here’s what I want you to do. 1 see in your analysis tha you don’t project greater sales as a result of the warehouse. It seems to me, if we can store more goxLs, then will have more to sell. Thus, logically, a larger warehouse translates into more sales. If you incorporate this into your analysis, I think you’ll see that the numbers will work out. Why don’t you work it through and come back with a new analysis? I’m really counting on you on this one. Let’s get off to a good start together and see if we can get this project accepted. What is your advice to Erin?Assume you have been hired by Hilton Hotels and Resorts. As part of your new role in the accounting department, you have been tasked to set up a responsibility accounting structure for the company. As your first task, your supervisor has asked you to give an example of a cost center, profit center, and an investment center within the Hilton organization. Your supervisor is a little unsure of the difference between a profit center and investment center and would like you to explain the difference.
- Consider the following conversation between Leonard Bryner, president and manager of a firm engaged in job manufacturing, and Chuck Davis, certified management accountant, the firms controller. Leonard: Chuck, as you know, our firm has been losing market share over the past 3 years. We have been losing more and more bids, and I dont understand why. At first, I thought that other firms were undercutting simply to gain business, but after examining some of the public financial reports, I believe that they are making a reasonable rate of return. I am beginning to believe that our costs and costing methods are at fault. Chuck: I cant agree with that. We have good control over our costs. Like most firms in our industry, we use a normal job-costing system. I really dont see any significant waste in the plant. Leonard: After talking with some other managers at a recent industrial convention, Im not so sure that waste by itself is the issue. They talked about activity-based management, activity-based costing, and continuous improvement. They mentioned the use of something called activity drivers to assign overhead. They claimed that these new procedures can help to produce more efficiency in manufacturing, better control of overhead, and more accurate product costing. A big deal was made of eliminating activities that added no value. Maybe our bids are too high because these other firms have found ways to decrease their overhead costs and to increase the accuracy of their product costing. Chuck: I doubt it. For one thing, I dont see how we can increase product-costing accuracy. So many of our costs are indirect costs. Furthermore, everyone uses some measure of production activity to assign overhead costs. I imagine that what they are calling activity drivers is just some new buzzword for measures of production volume. Fads in costing come and go. I wouldnt worry about it. Ill bet that our problems with decreasing sales are temporary. You might recall that we experienced a similar problem about 12 years agoit was 2 years before it straightened out. Required: 1. Do you agree or disagree with Chuck Davis and the advice that he gave Leonard Bryner? Explain. 2. Was there anything wrong or unethical in the behavior that Chuck Davis displayed? Explain your reasoning. 3. Do you think that Chuck was well informedthat he was aware of the accounting implications of ABC and that he knew what was meant by cost drivers? Should he have been well informed? Review (in Chapter 1) the first category of the Statement of Ethical Professional Practice for management accountants. Do any of these standards apply in Chucks case?Identifying ethical standards The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) are violated in each situation? You tell your brother that your company will report earnings significantly above financial analysts’ estimates. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.” At a company-paid conference on e-commerce, you skip the afternoon session and go sightseeing. You failed to read the detailed specifications of a new accounting software package that you asked your company to purchase. After it is installed, you are surprised that it is incompatible with some of your company’s older accounting software. You do not provide top management with the detailed job descriptions they requested because you fear…Identifying ethical standards The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) are violated in each situation? a. You tell your brother that your company will report earnings significantly above financial analysts’ estimates. b. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.” c. At a company-paid conference on e-commerce, you skip the afternoon session and go sightseeing. d. You failed to read the detailed specifications of a new accounting software package that you asked your company to purchase. After it is installed, you are surprised that it is incompatible with some of your company’s older accounting software. e. You do not provide top management with the detailed job descriptions they requested…
- Question 3 Please provide a very detail answer for the below question:- Asma is a junior management accountant at Flower Cloth Ltd. Asma is given the task of compiling a cost-benefit analysis report on whether the company should purchase an expensive new machine from Radi Ltd, where her brother is the new sales manager. Asma did not tell anyone in Flower Cloth about her brother’s new job. In preparing her report, Asma overstates the qualitative benefits and understates the costs associated with this new machine to help her brother make his first sales as the new sales manager. Required: Discuss why and how Asma has deviated from the standards of ethical conduct.Anita Brown is the manager of a wholesale food company. Her compensation, in part, is incentive-based. In other words, the higher the company income, the higher her incentive compensation. Each year, in an effort to influence her bonus, Anita makes several recommendations, concerning adjusting entries, to the company controller. One of her favorites is to ask the controller to reduce the estimate of doubtful accounts.1. How does lowering the estimate of doubtful accounts affect the income statement and balance sheet?2. Is there an ethical consideration in this case? If so, what is it?3. Should Anita be permitted to weigh in on adjusting entries under these circumstances? Why or why not?Assume Ethan Lester and Vick Jensen are CPAs. Ethan was seen as a “model employee” who deserved a promotion to director of accounting, according to Kelly Fostermann, the CEO of Fostermann Corporation, a Maryland-based, largely privately held company that is a prominent global designer and marketer of stereophonic systems. The company has an eleven person board of directors. Kelly considered Ethan to be an honest employee based on performance reviews and his unwillingness to accept the promotion, stating that he wasn’t ready yet for the position. Kelly admired his willingness to learn and grow, not just expect a promotion. Little did she know that Ethan was committing a $50,000 fraud during 2015 by embezzling cash from the company. In fact, no one seemed to catch on because Ethan was able to override internal controls. However, the external auditors were coming in and to solidify the deception, he needed the help of Vick Jensen, a close friend who was the accounting manager and also…
- Assume Ethan Lester and Vick Jensen are CPAs. Ethan was seen as a “model employee” who deserved a promotion to director of accounting, according to Kelly Fostermann, the CEO of Fostermann Corporation, a Maryland-based, largely privately held company that is a prominent global designer and marketer of stereophonic systems. The company has an eleven person board of directors. Kelly considered Ethan to be an honest employee based on performance reviews and his unwillingness to accept the promotion, stating that he wasn’t ready yet for the position. Kelly admired his willingness to learn and grow, not just expect a promotion. Little did she know that Ethan was committing a $50,000 fraud during 2015 by embezzling cash from the company. In fact, no one seemed to catch on because Ethan was able to override internal controls. However, the external auditors were coming in and to solidify the deception, he needed the help of Vick Jensen, a close friend who was the accounting manager and also…Assume Ethan Lester and Vick Jensen are CPAs. Ethan was seen as a “model employee” who deserved a promotion to director of accounting, according to Kelly Fostermann, the CEO of Fostermann Corporation, a Maryland-based, largely privately held company that is a prominent global designer and marketer of stereophonic systems. The company has an eleven person board of directors. Kelly considered Ethan to be an honest employee based on performance reviews and his unwillingness to accept the promotion, stating that he wasn’t ready yet for the position. Kelly admired his willingness to learn and grow, not just expect a promotion. Little did she know that Ethan was committing a $50,000 fraud during 2015 by embezzling cash from the company. In fact, no one seemed to catch on because Ethan was able to override internal controls. However, the external auditors were coming in and to solidify the deception, he needed the help of Vick Jensen, a close friend who was the accounting manager and also…Big Tractor, Inc.'s best salesperson is Misty Hammond. Hammond's largest sales have been to Farmer's Cooperative, a customer she brought to the company. Another salesperson, Bob Blanchette has been told in confidence by his cousin (an employee of Farmer's Cooperative) that Farmer's Cooperative is experiencing financial difficulties and may not be able to pay Big Tractor Inc. what is owed. Both Hammond and Blanchette are being considered for a promotion to a new sales manager position. What are the ethical considerations that Bob Blanchette faces? What alternatives do you think he has?
