Principles of Accounting Volume 1
19th Edition
ISBN: 9781947172685
Author: OpenStax
Publisher: OpenStax College
expand_more
expand_more
format_list_bulleted
Textbook Question
Chapter 15, Problem 2TP
A
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Alexandra and Kellie operate a beauty salon as partners who share profits and losses equally. The success of their business has exceeded their expectations; the salon is operating quite profitably. Kellie is anxious to maximize profits and schedules appointments from 8 a.m. to 6 p.m. daily, even sacrificing some lunch hours to accommodate regular customers. Alexandra schedules her appointments from 9 a.m. to 5 p.m. and takes long lunch hours. Alexandra regularly makes significantly larger withdrawals of cash than Kellie does, but, she says, “Kellie, you needn’t worry, I never make a withdrawal without you knowing about it, so it is properly recorded in my drawings account and charged against my capital at the end of the year.” Alexandra’s withdrawals to date are double Kellie’s.
Who are the stakeholders in this situation?
Identify the problems with Alexandra’s actions and discuss the ethical considerations involved.
How might the partnership agreement be revised to accommodate the…
Farah and David decide to form a sports memorabilia retail partnership. They have known each other since business graduate school and have always worked well together on various projects. The business is doing well but cash flow is very tight. Farah takes several calls from vendors asking for payment. He believed David had been paying the bills. When he asks about this, David admits to embezzling from the partnership.
What liability does Farah face as a result of the theft?
Are you for or against a partnership? Please explain.
Neil and Dylan are partners in a lawn mower repair business in Ohio. While Neil is on vacation visiting his sister in Georgia, his sister's neighbor has trouble with her mower and Neil fixes it for her. She insists on paying him . Neil :
O a. may keep the money as this partnership is NOT a professional business pursuant to the non - professional exception rule.
O b. may not accept the money because it would create a conflict of interest.
O c. may keep the payment since he did the work while he was on vacation.
O d. may not accept the money because it would mean he was taking a business opportunity away from the partnership.
O e. must turn the money over to the partnership because he earned it doing the kind of work that the partnership does.
Chapter 15 Solutions
Principles of Accounting Volume 1
Ch. 15 - A partnership ________. A. has one owner B. can...Ch. 15 - Any assets invested by a particular partner in a...Ch. 15 - Which of the following is a disadvantage of the...Ch. 15 - Mutual agency is defined as: A. a mutual agreement...Ch. 15 - Chani contributes equipment to a partnership that...Ch. 15 - Juan contributes marketable securities to a...Ch. 15 - Which one of the following would not be considered...Ch. 15 - A well written partnership agreement should...Ch. 15 - What type of assets may a partner not contribute...Ch. 15 - How does a newly formed partnership handle the...
Ch. 15 - Thandie and Marco are partners with capital...Ch. 15 - Thandie and Marco are partners with capital...Ch. 15 - Thandie and Marco are partners with capital...Ch. 15 - Thandie and Marco are partners with capital...Ch. 15 - When a partnership dissolves, the first step in...Ch. 15 - When a partnership dissolves, the last step in the...Ch. 15 - Prior to proceeding with the liquidation, the...Ch. 15 - Does a partnership pay income tax?Ch. 15 - Can a partners personal assets in a limited...Ch. 15 - Can a partnership assume liabilities as part of...Ch. 15 - Does each partner have to contribute an equal...Ch. 15 - What types of bases for dividing partnership net...Ch. 15 - Angela and Agatha are partners in Double A...Ch. 15 - On February 3, 2016 Sam Singh invested $90,000...Ch. 15 - Why do partnerships dissolve?Ch. 15 - What are the four steps involved in liquidating a...Ch. 15 - When a partner withdraws from the firm, which...Ch. 15 - What is the first step in a partnership...Ch. 15 - When a partnership liquidates, do partners get...Ch. 15 - Coffee Partners decides to close due to the...Ch. 15 - On May 1, 2017, BJ and Paige formed a partnership....Ch. 15 - The partnership of Chase and Chloe shares profits...Ch. 15 - The partnership of Tasha and Bill shares profits...Ch. 15 - Cheese Partners has decided to close the store. At...Ch. 15 - The partnership of Michelle, Amal, and Maureen has...Ch. 15 - The partnership of Tatum and Brook shares profits...Ch. 15 - Arun and Margot want to admit Tammy as a third...Ch. 15 - When a partnership is liquidated, any gains or...Ch. 15 - The partnership of Magda and Sue shares profits...Ch. 15 - The partnership of Arun, Margot, and Tammy has...Ch. 15 - Match each of the following descriptions with the...Ch. 15 - While sole proprietorships and corporations are...Ch. 15 - A partnership is thriving. The three partners get...
Additional Business Textbook Solutions
Find more solutions based on key concepts
What is management by objectives?
Principles of Management
E6-14 Using accounting vocabulary
Learning Objective 1, 2
Match the accounting terms with the corresponding d...
Horngren's Accounting (11th Edition)
E3-27 Identifying the impact of adjusting entries on the financial statements
Learning Objectives 3,5
Aus...
Horngren's Accounting (12th Edition)
Which of the following statements is not correct? A. The sales budget is computed by multiplying estimated sale...
Principles of Accounting Volume 2
Discussion Questions 1. What characteristics of the product or manufacturing process would lead a company to us...
Managerial Accounting (4th Edition)
A piece of equipment is purchased for $40,000 and has an estimated salvage value of $1,000 at the end of the re...
Construction Accounting And Financial Management (4th Edition)
Knowledge Booster
Similar questions
- Alexia Jones is a worker at a local 24-hour pharmacy. Alexia works the night shift and is the only worker. Because management is cost-conscious and business is slow at night, Alexia has been given the responsibility to do the accounting from the previous day. Alexia has two children, and her husband does not work. Alexia has strong pressure to provide well for her family. Is the pharmacy at risk for fraud? Why or why not?arrow_forwardBob, Frank, and Frances are equal partners in a closely held business. Although the partners work well together, their spouses and children do not. No partner is ready to quit the business and/or retire, but they are each worried about how the business would operate if one of the partners left the business due to death or disability. Each partner is financially overextended and thus does not enjoy good cash flow currently. Which one of the following is the most appropriate business transfer technique for the partners to use considering these circumstances? A) A preferred stock recapitalization of the business B) A private annuity agreement among the partners C) A cross-purchase buy-sell agreement among the partners D) An entity buy-sell agreement between the business and each partnerarrow_forwardAlice owns a contracting company that receives most of its business through government contracts. A new procurement officer with a government agency implies to Alice that if she does not send him a bribe for her latest awarded contract, she will not get any further contracts. If Alice loses future contracts, her business will fail. She reluctantly gives the officer a bribe. Has Alice committed a violation? A. Yes, because Alice was not under economic duress. B. Yes, because being extorted is not a defense to giving a bribe. C. No, because Alice was under economic duress. D. No, because Alice was not the one who proposed the bribe.arrow_forward
- Dennis just got hired after not working for two years following his reporting of financial statement fraud by his previous employer. Dennis was treated as an outcast and ultimately fired after the company “trumped up” some unsubstantiated claims of poor performance. Dennis fought thedismissal in court as wrongful termination but lost. It was two difficult years during which time his marriage broke up. In order to get hired for the new job, Dennis felt compelled to shade the truth about why he left the job. Here is what Dennis told the recruiter when asked whether he had left thecompany because of any differences:“I didn’t feel as though there was a good growth path and that it didn’t make sense to stay somewhere that wasn’t going to work out for me.”Did Dennis do the right thing? Explain.arrow_forwardSharon is an intern with a local CPA firm. Prior to returning to school, her supervisor goes on sick leave and asks her to do some complicated reconciliation work for him. She is given what seems to her to be an unrealistic deadline. Sharon looks at the workpapers and supporting documentation and realizes she doesn’t have the skills to complete the work without help. She contacts her supervisor who tells her to talk to Holly, a good friend of Sharon and former intern at the firm, for help. Holly returned to school one semester ago. What ethical considerations do you have in this matter? What would you do and why?arrow_forwardMartin Manera is one of three partners who own and operate TaftWorld, a global import and export business. Martin is the partner in charge of recording partnership transactions in the accounts. One day while driving to work, Martin’s car broke down. Upon inspection, the mechanic discovered the engine had to be replaced at a cost of $5,000. Martin does not have enough money in his bank account and his credit cards are at their limits. He has to have this car to come to work, and he only uses his car for this purpose. He decides to take $5,000 from the partnership for the repair and record it as an expense of the partnership. What are three ethical issues in this scenario?arrow_forward
- Chloe has her own office where she generates investment advice for companies. She is compensated for her advice. Which of the following is false? Chloe does not have to be a registered adviser if she doesn’t have authority to make investment choices for her clients. Chloe does not have to be a registered adviser if all of her clients are in the same state as her office. Chloe does have to be a registered adviser even if she only advises for one company.arrow_forwardA junior executive is fed up with the operating policies of his boss. Before leaving the office of his angered superior, the young man suggests that a well-‐trained monkey could handle the trivia assigned to him. Pausing a moment to consider the import of this closing statement, the boss is seized by the thought that this must have been in the back of her own mind ever since she hired the junior executive. She decides to consider replacing the executive with a bright young baboon. She figures that she couldargue strongly to the board that such “capital deepening” is necessary for the cost-‐conscious firm. Two days later, a feasibility study is completed, and the following data are presented to the president: •It would cost $12,000 to purchase and train a reasonably alert baboon with a life expectancy of 20 years. •Annual expenses of feeding and housing the baboon would be $4,000. •The junior executive’s annual salary is $7,000 (a potential saving if the baboon is hired). •The baboon…arrow_forwardMarco Brolo is one of three partners who own and operate Silkroad Partners, a global import–export business. Marco is the partner in charge of recording partnership transactions in the accounts. On his way to work one day, Marco's car broke down. At the repair shop, Marco learned that his car's engine had significant damage, and it will cost over $2,000 to repair the damage. He does not have enough money in his bank account to cover the cost of the repair, and his credit cards are at their limit. This car is the only form of transportation that Marco has to get to and from work every day. He does not use his car for any business travel. After considering his options, Marco decides to take $2,000 from the partnership for the repair, and record it as an expense of the partnership. He believes that this is appropriate since he needs his car to get to work every day. Is Marco behaving ethically? Why? Who is affected by Marco's decision? What other alternatives might Marco…arrow_forward
- Alma and Jean wrote a business proposal for their local partner, the GIF Corporation. They submitted the proposal to Mr. John Uy, the CEO of the said company. Upon checking, Mr. Uy found out that the business proposal had faulty details about the GIF Corporation. Also, Mr. Uy got tired of reading the entire proposal as it contained unimportant parts. Since Mr. Uy is a busy person, he did not have enough time to read everything in the proposal and resorted to asking Alma and Jean to revise the entire document. Question: Evaluate what characteristic (s) of effective technical communication is not observed and provide a discussion of why you say soarrow_forwardGovernment contracts account for the majority of Alice's business, which she owns as a contracting firm. A new procurement official with a government organisation makes an implied threat to Alice that she won't receive any further contracts if she doesn't offer him a bribe for her most recent deal. Alice's company will shut down if she loses further customers. She bribes the police reluctanly. Has Alice broken any rules? A. Alice was not under financial pressure, thus the answer is yes. B. Insofar as being the victim of extortion does not excuse paying a bribe. C. No, since Alice was struggling financially. D. No, because the bribe wasn't suggested by Alice.arrow_forwardHoping to increase sales, Festival Cruises began advertising for a “Valentine’s Day Cruise package” which the cruise liner ‘guarantees to be the most romantic experience of you and your partner’s entire life’ and which is guaranteed to ‘rekindle the flame of love in any marriage’. Susan and Mark bought tickets for the cruise, had a big argument, and broke up. Susan wants to sue Festival Cruises for False Misrepresentation.Required: Discuss whether you agree with Susan’s belief that the company is guilty of False Misrepresentation. Give reasons and refer to law.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education