Which of the following would constitute an Agency Problem in the context of Business? Check all of the following that apply.Check All That ApplyA manager authorizes a trip to Europe for himself at the company's expense even though he has no intention ofdoing any company business while on the trip.A manager makes a bad decision that costs the company tens of thousands of dollars, but he believes he is actingIn the company's best interest rather than his own in making the decision.An employee takes home a box of pens for personal use without prior authorization,A manager turns down a project that analysis has shown to be profitable for the company because she is afraid ofnegative consequences for herself if something goes wrong.

An agency problem is a conflict of interest between an agent and a principal. An agent can be an…

Answered: Which of the following would constitute…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter8: Fraud, Internal Controls, And Cash

Section: Chapter Questions

Problem 3MC: What is the best way for owners of small businesses to maintain proper internal controls? A. The...

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Which of the following would be best considered to be an agency conflict problem in the behavior of the following financial managers? pack to later. O A. Bill chooses to pursue a risky investment for the company's funds because his compensation will substantially rise if it succeeds. O B. Sue instructs her staff to skip safety inspections in one of the company's factories, knowing that it will likely fail the inspection and incur significant costs to fix. OC. Michael chooses to enhance his firm's reputation at some cost to its shareholders by sponsoring a team of athletes for the Olympics. O D. James ignores an opportunity for his company to invest in a new drug to fight Alzheimer's disease, judging the drug's chances of succeeding as low. stv MacBook Air DII DD 888 F9 20 F7 F8 F6 F5 F4 esc F2 F3 F1 &
Mr. Bader is leaving the accounting practice to become the Finance Director of a client company. The ethical dilemma he is most likely to face would be a. Objectivity b. Integrity c. Professional Behavior d. Confidentialit
Appointing a person as your agent via a power of attorney can be extremely important and practical for managing one's financial affairs. This is especially true if someone is away for a significant amount of time (such as on a deployment). However, the person who is appointed as the agent can wreck the principal if bad decisions are made. What qualities should you look for when appointing someone as an agent via a power of attorney and/or a durable power of attorney?
In the scenario, where employer has been putting more emphasis on controlling costs for the various businesses. With the slowing of overall spending in one sector, while ordering managers to closely monitor expenses, selling several companies and giving vice presidents greater responsibility for statements of financial positions. Whatpositive and negative consequences might this pose to the company in future fraud prevention? Outline at least three of each type.
True or False: Effectiveness is doing the right things of completing activities so that the organization’s goals are obtained. Political and legal factors are part of the external environment of a business. Delayering has no consequence on the span of control of an organization Shareholders can be sued for the debts of a limited company. Organizations that operate globally do not have to be sensitive to local conditions.
Assume you are the manager of this area in a small firm. What internal controls and segregation of duties need to be considered in this area? What are some typical policies that companies put in place to safeguard this area? Find an example of a small company that has had issues in this area. Briefly recap the situation and how it was resolved.
What are operations people’s primary complaints against the accounting procedures used in most firms? Explain how such procedures can cause poor decisions for the total company.
The SEC is trying to get companies to notify the investment community more quickly when a "material change" will affect their forthcoming financial results. In what sense might a financial manager be seen as "more ethical" if he or she follows this directive and issues a press release indicating that sales will not be as high as previously anticipated? A manager at a "Check Into Cash" business (see Focus on Ethics box on page 192) defends his business practice as simply "charging what the market will bear." "After all," says the manager, "we don't force people to come in the door." How would you respond to this ethical defense of the payday-advance business? Bond rating agencies have invested significant sums of money in an effort to determine which quantitative and nonquantitative factors best predict bond defaults. Furthermore, some of the raters invest time and money to meet privately with corporate personnel to get nonpublic information that is used in assigning the issue's bond…
Imagine that you are the new department manager of a corporation within your chosen field: you discover that your predecessor had been using cash basis of accounting, which has resulted in many errors and misinformation. What measures would you take to remediate the issue? Propose a high-level plan to implement a proper accounting system for your department using specific principles. For example, which financial statements would you investigate first? What sort of internal controls would you implement?
The operation manager of Marcoba Bhd is seeking your advice on his company's request for a computer software to be used in managing the sales of the company. He is unsure of how to obtain the computer software but realizes that different types of acquisition will impact the company's financial statement differently. He is considering the following possibilities: a) Making a purchase of the computer software externally. The quotation that he has received includes packages for payroll and general ledger. b) Making a purchase of a computer software that can be incorporated into a sales system that the company will develop. c) Signing a contract with independent programmers to develop a computer software that will specifically cater for Marcoba Bhd's own use d) Employing own programmers to write a computer software that the company will use. Required: Advice the operation manager on the impact of each possibility above on the company's financial statement
The CEO of the Baker Inc, wants to implement a new accounting system, to improve work flow through the company’s sales, cash receipts, accounts payable, and cash disbursement procedures. The CEO is, however, concerned about the potential disruption that the implementation will have on operations. In an announcement letter to Baker’s employees, the CEO stated that: “I have contracted Flybynight Consulting Group to do the needs analysis, system selection, and design work. The programming and implementation will be performed in-house using existing IT department staff. The development process will be unobtrusive to user departments because Flybynight knows what needs to be done. They will work independently, in the background, and will not disrupt departmental and internal audit work flow with time consuming interviews, surveys, and questionnaires. This promises to be an efficient process that will produce a system that will be appreciated by all users.” Required: Draft a memo from George…
What should an organization do if performance measures change? A. Make sure that the manager being evaluated is aware of the measurement change, as this may affect his or her decision-making. B. Make sure that the manager benefits without the corporation also benefitting. C. Make sure that there are significant overriding opportunities for each manager, if the manager is unaware of the change. D. Obtain customer surveys on the change before communicating the change to the manager.

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