Discussion I
• Summarize the events of a recent accounting scandal.
• Identify how the illegal/unethical act was detected and the punishments that resulted (fines, prison terms, etc.).
• What could have been done to detect this act earlier.
• What could have been done to prevent this from happening in the first place.
Discussion II
This week we learn about long-lived assets (Property Plant and Equipment - Chapter 9) and current liabilities and payroll (Chapter 11).
This discussion questions are as follows:
• How is the cost of a lump-sum purchase allocated to the individual assets acquired? Provide a simple example of how the allocation would be performed if your company paid $1,000,000 cash in total for a restaurant (land, building, and equipment), and the appraised value was actually $1,200,000 for the 3 asset components $400,000, $500,000, and $300,000, respectively.
• Does the balance in the Accumulated Depreciation - Machinery account represent funds to replace the machinery when it wears out? If not, what does it represent?
• Assume you work for a company in sales and therefore are entitled to not only hourly pay, but commission and bonus as well. You work 40 hours in a payroll week. Calculate your gross pay for your company if you make $x per hour (you select your rate!), earn a 5% bonus (of gross pay), and earn 10% commission (of gross pay).
• Unfortunately, you do not get to keep all your Gross Pay. Assuming you have the following withholding deductions taken out of your pay, now calculate your Net Pay.
Withholding deductions:
Employee income tax (20%)
Employee OASDI tax (see book for how to calculate)
Employee Medicare tax (1.45%)
Employee health insurance 75
Employee contribution to United Way 20
Total withholdings:
Discussion III
In this Module, we learn about Stockholders' Equity (Chapter 13). This week's discussion questions are as follows:
• Discuss the difference between authorized shares and outstanding shares.
• Are there other classifications of shares that are important to consider?
• What are treasury stocks and why do companies engage in their purchase?
Discussion IV
Learn about the Statement of Cash Flows (Chapter 14). This week's discussion questions are as follows:
• What is the reporting purpose of the statement of cash flows? Why is this important to investors?
• Summarize the three types of cash flow activities, and describe at least 2 types of cash flows in EACH type of activity
• Is depreciation a source of cash flow? Why or why not?
The response must include a reference list. Using Times New Roman 12 pnt font, double-space, one-inch margins, and APA style of writing and citations.