The chair of the FASB at one time noted that “the flowof standards can only be slowed if (1) producers focus less on quarterly earnings per share and taxbenefits and more on quality products, and (2) accountants and lawyers rely less on rules and law and moreon professional judgment and conduct.” Explain his comment.

Trustees of the Pallor Corp. pension plan ask consultant Donald Millip to comment on the following statements. What should his response be?a. Median manager benchmarks are statistically unbiased measures of performance over long periods of time.b. Median manager benchmarks are unambiguous and are therefore easily replicated by managers wishing to adopt a passive/indexed approach.c. Median manager benchmarks are not appropriate in all circumstances because the median manager universe encompasses many investment styles.

Stricter rules for health, environment and safety (HSE) lead to:   a Reduced employment because taxes must be increased to pay for HSE measures b. Reduced employment because it becomes more expensive for companies to hire people c. Increase employment because there will be fewer accidents and thus fewer work-related injuries d. Increase employment because HSE leads to new work tasks that require extra employees

II.  Jerry Prior, Beeler Corporation’s controller, is concerned that net income may be lower this year. He is afraid upper-level management might recommend cost reductions by laying off accounting staff including him. Prior knows that depreciation is a major expense for Beeler. The company currently uses the double-declining-balance method for both financial reporting and tax purposes, and he’s thinking of selling equipment that, given its age, is primarily used when there are periodic spikes in demand. The equipment has a carrying value of $2,000,000 and a fair value of $2,180,000. The gain on the sale would be reported in the income statement. He doesn’t want to highlight this method of increasing income. He thinks, “Why don’t I increase the estimated useful lives and the salvage values? That will decrease depreciation expense and require less extensive disclosure, since the changes are accounted for prospectively. I may be able to save my job and those of my staff.” Instructions…