MANAGERIAL ACCOUNTING (PRINT UPGRADE)
12th Edition
ISBN: 9781264119547
Author: HILTON
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 1, Problem 33C
1.
To determine
Explain the Person N’s ethical responsibilities in this circumstance.
2.
To determine
State whether person N must tell the appropriate progressive officials regarding the postponement of paper order.
3.
To determine
Describe the steps that Person N must take to resolve the situation.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Elitz and Van Aken, CPAs, offer three types of services to clients: auditing, tax, and small business accounting. Based on experience and projected growth, the following billable hours have been estimated for the year ending December 31, 2020:
Service
Billable Hours
Audit Department:
Staff
22,400
Partners
7,900
Tax Department:
Staff
13,200
Partners
5,500
Small Business Accounting Department:
Staff
3,000
Partners
600
The average billing rate for staff is $160 per hour, and the average billing rate for partners is $350 per hour. Prepare a professional fees earned budget for Elitz and Van Aken, CPAs, for the year ending December 31, 2020, using the following column headings and showing the estimated professional fees by type of service rendered and add additional rows in the table as needed:
You are an audit assistant within the internal audit department of Crofty, a company that manufactures household cleaning products and solutions. The company is rapidly expanding and currently employs over 2,000 staff. Turnover has increased by about 20% for the last three years, due mainly to the aggressive sales strategy employed by the sales manager. Turnover for the year ended 31 December 2020 was £100 million and profit was also high. The Crofty board of directors approved the creation of an internal audit at the beginning of 2020, to assist with the control of the company and also prepare for a possible listing on the stock exchange in 2022. The internal auditors currently report to the finance director.The CEO is keen to see the company comply with principles of good corporate governance and has requested your help with ensuring the company complies in full.Required:(a) Explain the reasons why internal auditors should or should not report their findings on internal control to…
You are an audit assistant within the internal audit department of Crofty, a company that manufactures household cleaning products and solutions. The company is rapidly expanding and currently employs over 2,000 staff. Turnover has increased by about 20% for the last three years, due mainly to the aggressive sales strategy employed by the sales manager. Turnover for the year ended 31 December 2020 was £100 million and profit was also high.The Crofty board of directors approved the creation of an internal audit at the beginning of 2020, to assist with the control of the company and also prepare for a possible listing on the stock exchange in 2022. The internal auditors currently report to the finance director.The CEO is keen to see the company comply with principles of good corporate governance and has requested your help with ensuring the company complies in full.Required: (a)Explain the reasons why internal auditors should or should not report their findings on internal control to the…
Chapter 1 Solutions
MANAGERIAL ACCOUNTING (PRINT UPGRADE)
Ch. 1 - Prob. 1RQCh. 1 - Prob. 2RQCh. 1 - List and define the four basic management...Ch. 1 - Prob. 4RQCh. 1 - Prob. 5RQCh. 1 - List and describe four important differences...Ch. 1 - Distinguish between cost accounting and managerial...Ch. 1 - Prob. 8RQCh. 1 - Prob. 9RQCh. 1 - How could your college or university use the...
Ch. 1 - What does the following statement by a managerial...Ch. 1 - What is meant by the following statement?...Ch. 1 - Prob. 13RQCh. 1 - Prob. 14RQCh. 1 - Prob. 15RQCh. 1 - Prob. 16RQCh. 1 - Prob. 17RQCh. 1 - What is meant by the term non-value-added costs?Ch. 1 - Can managerial accounting play an important role...Ch. 1 - Prob. 21RQCh. 1 - Prob. 22RQCh. 1 - Name several activities in the value chain of (a)...Ch. 1 - Define the term strategic cost management.Ch. 1 - Give an example of managerial accounting...Ch. 1 - For each of the following activities, explain...Ch. 1 - Susan Lopez, a consultant with Deloitte Young,...Ch. 1 - Prob. 31PCh. 1 - Urban Elite Apparel designs womens apparel and...Ch. 1 - Prob. 33C
Knowledge Booster
Similar questions
- You are an audit assistant within the internal audit department of Crofty, a company that manufactures household cleaning products and solutions. The company is rapidly expanding and currently employs over 2,000 staff. Turnover has increased by about 20% for the last three years, due mainly to the aggressive sales strategy employed by the sales manager. Turnover for the year ended 31 December 2020 was £100 million and profit was also high. The Crofty board of directors approved the creation of an internal audit at the beginning of 2020, to assist with the control of the company and also prepare for a possible listing on the stock exchange in 2022. The internal auditors currently report to the finance director.The CEO is keen to see the company comply with principles of good corporate governance and has requested your help with ensuring the company complies in full. Required: Discuss the merits and shortcomings of Crofty forming an audit committeearrow_forwardYou have recently been appointed as the management accountant attached to the head office of the company with special responsibility of monitoring the performance of the companies within the group. Each company is treated as an investment center and every month produces an operating statement for the group headquarters. Summaries of the statements for companies X and Y which make similar products selling at similar prices for the last month showed a typical situation. Extract from the company monthly operating statements. X Y GHS000 GHS000 Sales 600 370 Less variable cost 229 208 Contribution 371 162 Less controllable fixed…arrow_forwardMalone Industries has been in business for five years and has been very successful. In the past year, it expanded operations by buying Hot Metal Manufacturing for a price greater than the value of the net assets purchased. In the past year, the customer base has expanded much more than expected, and the companys owners want to increase the goodwill account. Your CPA firm has been hired to help Malone prepare year-end financial statements, and your boss has asked you to talk to Malones managers about goodwill and whether an adjustment can be made to the goodwill account. How do you respond to the owners and managers?arrow_forward
- Elliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of 25,750 and is capable of processing as many as 6,500 purchase orders per year. Each clerk uses a PC and laser printer in processing orders. Time available on each PC system is sufficient to process 6,500 orders per year. The cost of each PC system is 1,100 per year. In addition to the salaries, Elliott spends 27,560 for forms, postage, and other supplies (assuming 26,000 purchase orders are processed). During the year, 25,350 orders were processed. Required: 1. Classify the resources associated with purchasing as (1) flexible or (2) committed. 2. Compute the total activity availability, and break this into activity usage and unused activity. 3. Calculate the total cost of resources supplied (activity cost), and break this into the cost of activity used and the cost of unused activity. 4. (a) Suppose that a large special order will cause an additional 500 purchase orders. What purchasing costs are relevant? By how much will purchasing costs increase if the order is accepted? (b) Suppose that the special order causes 700 additional purchase orders. How will your answer to (a) change?arrow_forwardYou have recently been appointed as the accountant attached to the head office of the company with the specific responsibility of monitoring the performance of the companies within the group. Each company is treated as an investment center and every month produces an operating statement for the group headquarters. Summaries of the statements for companies A and B which make similar products selling at similar prices for the last month showed a typical situation. Extract from the company monthly operating statements. A B GHS000 GHS000 Sales 600 370 Less variable cost 229 208 Contribution 371 162 Less controllable fixed overheads…arrow_forwardBryan Eubank began his accounting career as an auditor for a Big 4 CPA firm. He focused on clients in the high-technology sector, becoming an expert on topics such as inventory write-downs, stock options, and business acquisitions. Impressed with his technical skills and experience, General Electronics, a large consumer electronics chain, hired Bryan as the company controller responsible for all of the accounting functions within the corporation. Bryan was excited about his new position— for about a week until he took the first careful look at General Electronics' financial statements. The cause of Bryan's change in attitude is the set of financial statements he's been staring at for the past few hours. For some time prior to his recruitment, he had been aware that his new employer had experienced a long trend of moderate profitability. The reports on his desk confirm the slight but steady improvements in net income in recent years. The disturbing trend Bryan is now noticing,…arrow_forward
- Bryan Eubank began his accounting career as an auditor for a Big 4 CPA firm. He focused on clients in the high-technology sector, becoming an expert on topics such as inventory write-downs, stock options, and business acquisitions. Impressed with his technical skills and experience, General Electronics, a large consumer electronics chain, hired Bryan as the company controller responsible for all of the accounting functions within the corporation. Bryan was excited about his new position— for about a week until he took the first careful look at General Electronics' financial statements. The cause of Bryan's change in attitude is the set of financial statements he's been staring at for the past few hours. For some time prior to his recruitment, he had been aware that his new employer had experienced a long trend of moderate profitability. The reports on his desk confirm the slight but steady improvements in net income in recent years. The disturbing trend Bryan is now noticing, though,…arrow_forwardApricot is an information technology (IT) manufacturing company which has been dealing in various IT equipment over 70 years. It operates from one central site which includes the production facility, warehouse and administration offices. You are an audit senior in Juit Company, and you are commencing the audit planning of Apricot Company for the year ending 31 April 2019. Apricot Company sells all of it IT equipment to multinational clients, with 75% being sold to a multi-million IT dealer. The company has a one-year contract to be the sole supplier of IT equipment. In order to secure the contract, the company reduced prices and offered 100 days credit period, while its normal credit period is 28 days, which is an equivalent of month. Currently, Apricot Company has strategically reduced the level of products directly manufactured and rather started to import significant amount of its IT equipment from India. Nearly 65% of the IT equipment is imported and 35% manufactured. Purchase…arrow_forwardJames Wright is the chief financial officer (CFO) for The Butcher Block, a major steakhouse restaurant chain. As CFO, James has the final responsibility for all aspects of financial reporting. James tells investors that The Butcher Block should post earnings of at least $1 million. In examining the preliminary year-end numbers, James notices that earnings are coming in at $950,000. He also is aware that The Butcher Block has been depreciating most of its restaurant equipment over a five-year useful life. He proposes to change the estimated useful life for a subset of the equipment to a useful life of seven, rather than five, years. By depreciating over a longer useful life, depreciation expense will be lower in the current year, increasing earnings to just over $1 million. It looks like The Butcher Block is going to exceed earnings of $1 million after all. Do you think James Wright’s change in the depreciable life of assets is ethical? What concerns might you have?arrow_forward
- Seal Financial Advisors provides accounting and finance assistance to customers in the retail business. Seal has four professionals on staff and an office with six clerical staff. Total compensation, including benefits, for the professional staff runs about $573,000 per year, and normal billable hours are 8,300 hours per year. The professional staff keep detailed time sheets organized by client number. The total office and administrative costs for the year are $755,000. Seal allocates office and administrative costs to clients monthly, using a predetermined overhead allocation rate based on billable hours. What is the predetermined overhead allocation rate that Seal will use for office and administrative costs? (Round your answer to the nearest cent.) A. $69.04 per hour B. $21.93 per hour C. $160.00 per hour D. $90.96 per hourarrow_forwardGRB Ltd has several product lines with a manager in charge of each product line. The managers are paid a bonus based on the net income generated by their product line. Rubica (the CEO of GRB Ltd) was going through the financial reports of the 2nd quarter of 2021 to analyse the performance of the product lines. For 'Sweets' one of the largest product lines of GRB Ltd, Rubica noted that while the sales declined from $800,000 in quarter 1 to $600,000 in quarter 2, the product line manager of Sweets received a bonus larger than the 1st quarter. The manager of Sweets division was eligible for a higher bonus due to an operating profit increase from $90,000 in the 1st quarter to $120,000 in the 2nd quarter. Rubica wondered how the product line manager was entitled to a higher bonus with a decline in sales. Rubica also wants to know how net income increased with a decline in sales. Rubica found the following data from the financial reports of 'Sweets': Particulars Quarter 2 Quarter 1 Units…arrow_forwardShadder is a small company that manufactures knitwear products. It employs approximately 120 staff, all of whom are paid by bank transfer. Permanent factory staff are paid on a weekly basis based on the number of hours worked as evidenced by clock cards. Administration and sales staff are paid a monthly salary. The two directors of the company are also paid a monthly salary. Sales staff are paid a quarterly bonus calculated on the basis of sales. Directors are paid an annual bonus based on profits. During peak production seasons, temporary factory staff are hired through an agency and are paid on a weekly basis, based on their output. Supervisors at Shadder authorise documentation indicating the number of items produced by temporary staff. The agency is then paid by bank transfer and it is responsible for paying the temporary staff and for the deduction of tax and national insurance. You will be performing the audit of the financial statements for the year ending 31 March 2021 and you…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning