You are a summer intern working for a major professional services firm. During your lunch break each day, you andfellow intern, Bob, eat at a local sandwich shop. One day, Bob's girlfriend joins you for lunch. When the bill arrives,Bob pays with a company credit card and writes the meal off as a business expense. Bob and his girlfriend continue tobe "treated" to lunch for a number of days. You know Bob is well aware of a recent memo that came down frommanagement stating casual lunches are not valid business expenses. When you ask Bob about the charges, he replies,"Hey, we're interns. Those memos dont apply to us. We can expense anything we want."QUESTIONS:1. Who are the relevant facts?2. What Are the Ethical Issues?3. Who Are the Primary Stakeholders?4. What Are the Possible Alternatives?5. What Are the Ethics of the Altermatives?6. What Are the Practical Constraints?7. What Actions Should Be Taken?

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Answered: You are a summer intern working for a…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter6: Business Expenses

Section: Chapter Questions

Problem 28P

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Molly Mocha employs one college student every summer in her coffee shop. The student works the five weekdays and is paid on the following Monday. (For example, a student who works Monday through Friday, June 1 through June 5, is paid for that work on Monday, June 8.) The coffee shop adjusts its books monthly, if needed, to show salaries earned but unpaid at month-end. The student works the last week of July, which is Monday, July 28, through Friday, August 1. If the student earns $240 per day, what adjusting entry must the coffee shop make on July 31 to correctly record accrued salaries expense for July?

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