Choose a company. Use that company's operations to give three (3) examples of possible accounts receivable customers, and three (3) examples of possible makers of notes receivables in that company.

P2-2   (you can complete using journal entry or T-account format)

Darlene Cook Company engaged in the following transactions during the month of

July:

July 1 Acquired land for $10,000. The company paid cash.

8. Billed customers for $3,000. This represents an increase in revenue. The customer has

been billed and will pay at a later date. An asset, accounts receivable, has been created.

12. Incurred a repair expense for repairs of $600. Darlene Cook Company agreed to pay in 60 days. This transaction involves an increase in accounts payable and repair expense.

15. Received a check for $500 from a customer who was previously billed. This is a reduction in accounts receivable.

20. Paid $300 for supplies. This was previously established as a liability, account payable. Paid wages in the amount 24. of $400. This was for work performed during July.

Required Record the transactions, using T-accounts.

P2-3    (you can complete using journal entry or T-account format)

Gaffney Company had these adjusting entry situations at the end of December.

1. On July 1, Gaffney Company paid $1,200 for a one-year insurance policy. The policy was for the period July 1 through June 30. The transaction was recorded as prepaid insurance and a reduction in cash.

2. On September 10, Gaffney Company purchased $500 of supplies for cash. The purchase was recorded as supplies. On December 31, it was determined that various supplies had been consumed in operations and that supplies costing $200 remained on hand.

3. Gaffney Company received $1,000 on December 1 for services to be performed in the following year. This was recorded on December 1 as an increase in cash and as revenue. As of December 31, this needs to be recognized as Unearned Revenue, a liability account.

4. As of December 31, interest charges of $200 have been incurred because of borrowed funds. Payment will not be made until February. A liability for the interest needs to be recognized, as does the interest expense.

5. As of December 31, a $500 liability for salaries needs to be recognized.

6. As of December 31, Gaffney Company had provided services in the amount of $400 for

Jones Company. An asset, Accounts Receivable, needs to be recognized along with the revenue.

Required Record the adjusting entries at December 31, using T-accounts.

Which of the following would least likely prevent a computer hacking?

Select one:

a. Encryptions are used for sensitive data files, password files, and sensitive computer programs.

b. Passwords of transferred or terminated employees are changed immediately.

c. Security policies that include training for all employees, customers, and others who do not need to access the network.

d. Hacker publications and communications are reviewed to learn the current hacking methods.

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Which of the following is not a duty of the PCAOB (Public Company Accounting Oversight Board) under the Sarbanes-Oxley Act of 2002?

Select one:

a. The PCOAB has a duty to register public accounting firms that audit publicly traded companies.

b. The PCOAB has a duty to ensure that all audit work papers of CPA firms are maintained for at least seven years.

c. The PCOAB has a duty to conduct an inspection once every three years of CPA firms that regularly audit more than 100 public companies.

d. The PCOAB has a duty to establish or adopt auditing, quality control, ethics, independence and other standards relating to audits of publicly traded companies.

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In investigating insurance fraud, an accounting fraud examiner would least likely use which of the following computer-assisted detection methods?

Select one:

a. An accounting fraud examiner would use the computer to compare administrative files with payroll files to determine whether the insurance company is distributing payrolls to people who have changed their insurance policies.

b. An accounting fraud examiner would use the computer to generate an exception report for all exceptions to normal insurance policy procedures.

c. An accounting fraud examiner would use the computer to mail confirmation requests on delinquent premiums and change of address to verify that the insurance company’s records agree with the policyholders’ records.

d. An accounting fraud examiner would use the computer to compare insurance policy issue files with disbursement files to determine whether funds that are used to place new policies fraudulently come from the equity of old policies.

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It is usually more difficult to identify and trace off-book bribery payments than on-book bribery payments. Which of the following is the best approach when examining off-book bribery payments?

Select one:

a. The suspected off-book bribery payments are best approached from the point of payment (payer of bribery).

b. The suspected off-book bribery payments are best approached from the point of receipt (recipient of bribery).

c. The suspected off-book bribery payments are best approached by determining whether employees have failed to execute tax withholding forms, or have not elected to receive any health benefits or other optional withdrawals, such as enforced saving plans.

d. The suspected off-book bribery payments are best approached by reviewing the exit interviews and comparing the vendor addresses with addresses of subsequent employers.

A conflict of interest occurs when an employee of a company has an undisclosed economic or personal interest in a transaction that adversely affects his/her employer. Which of the following methods is least effective in detecting a conflict of interest between an employee and a vendor?

Select one:

a. Matching the vendor address with the employee address to check whether the vendor and the employee are the same business entity.

b. Comparing the vendor tax files with the employee tax files to reveal whether the vendor and the employee have the same tax evasion scheme.

c. Reviewing the employee’s exit interview to check whether he/she is has obtained employment from the vendor.

d. Listening closely to complaints from competing vendors to check whether a particular vendor is being favored.

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Which of the following is not a true statement regarding the detection of bank employee embezzlement?

Select one:

a. If the dollar amount of the embezzlement is so small that the bank’s financial statements will not be materially affected, the embezzlement can best be detected through a count of cash on hand.

b. If the dollar amount of the embezzlement is so large that the bank’s financial statement will be materially affected, the embezzlement can be best be detected through an analysis of the financial statements.

c. The bank should detect all bank employee embezzlement whether the dollar amount of the embezzlement will/will not materially affect the bank’s financial statements.

d. If the dollar amount of the embezzlement is so small that the bank’s financial statements will not be materially affected, the embezzlement can best be detected through a review of source documents.

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The California Security Breach Information Act (SB-1386) is a state law requiring organizations that maintain personal information about individuals to inform those individuals if the security of their information is compromised. Which of the following is the least likely step that organizations in California can take to comply with the Act?

Select one:

a. Appoint a bank lawyer or legal personnel to ensure SB-1386 compliance.  

b. Identify the location of all databases that contain personal information and implement access controls and physical security measures for data security.

c. Develop and implement procedures for rapid assessment of suspected security breaches, referral of suspected criminal acts to law enforcement agencies, notification of affected California residents and for appropriate public announcements to stakeholders and other interested parties to minimize the negative impact of the security breach.

d. Review arrangements with all third parties who store, process or transmit personal information and take steps to require them to adopt equivalent measures.

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In April 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Section 256) was signed into law. The Act affects any person involved in a bankruptcy proceeding. Which of the following statements is not true concerning the effects of the Act?

Select one:

a. A person in debt will have to work out a repayment plan instead of having his/her obligations erased in bankruptcy court.

b. A person with insufficient assets or income could still file a Chapter 7 bankruptcy, which, if approved by a judge, erases debts entirely after certain assets are forfeited.

c. A state bankruptcy judge determines whether an individual must repay some or all of his/her debt.

d. A person with an income above his/her state's median income will have to pay some or all of his/her credit-card charges, medical bills and other obligations under a court-ordered bankruptcy plan.

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Most states now expressly provide penalties for fraud perpetrated by using a computer and the internet. In 2005, California passed a state law on internet “spamming” - The Anti-Spam Law of 2005 (Senate Bill No.97) that

Select one:

a.
makes it a civil offense for anyone to create a website or domain name that seems like a legitimate online business and use it to ask, induce, request, or solicit any person to transmit, submit, or provide any means of identification without the authority or approval of the person.

b.

the victim to recover damages of $500,000 per unsolicited commercial e-mail advertisement transmitted in violation of the act, up to one million per incident, subject to reduction by the court.

c.
the perpetrator shall be punished by a fine of not more than $500,000, imprisonment in a county jail for not more than twelve months, or by both the fine and imprisonment.

d.
makes it a civil offense for anyone to create commercial e-mail advertisements containing certain falsifies, misrepresented, obscured, or misleading information.

Which of the following is a correct statement concerning the difference between a ponzi fraud and an illegal pyramid fraud?

Select one:

a. A ponzi fraud usually involves marketing of products and services; whereas, an illegal pyramid fraud usually involves marketing of financial instruments.

b. A ponzi fraud is an illegal business in which new investors’ money is used to make payments to earlier investors; whereas an illegal pyramid fraud is an illegal business in which new members are continually recruited to offer merchandise or services for sale, but only 70% of the business revenue comes from the sales whereas 30% of the business revenue comes from recruitment of new members.

c. A ponzi fraud requires a steady supply of new investors; whereas an illegal pyramid fraud does not require a steady supply of new members.

d. A ponzi fraud is an illegal business; whereas, a pyramid fraud can be a legal or illegal business.

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Which of the following is not a precaution that an accounting fraud examiner should take when gathering computer evidence relating to an insider computer fraud?

Select one:

a. Do not eat, drink, or smoke close to the computer system or near any of the storage devices.

b. Do not fingerprint magnetic media; the fingerprint powder could permanently damage the drive equipment.

c. Do not fold or bend disks, or touch the magnetic media inside the disk cover.

d. Do not connect or disconnect any of the cables when the computer is not in operating mode.

You are the owner of a lawn service company (LawnCo) which provides grounds and maintenance services to a range of corporate customers. Customers are expected to pay on the first of each month, in advance of receiving services. One of your corporate customers is an eldercare facility whose grounds you have maintained for many years. The customer has not paid for the last three months of services (from Oct.–Dec. 2020); nevertheless, to maintain a positive relationship, your company continued to provide mowing and weed control services to the eldercare facility during that time. Your company ceased providing services in January 2021 and found out in that same month that the eldercare facility filed for bankruptcy in September. Your company now believes that collection of the missed payments is extremely unlikely.  Your company has already issued financial statements to lenders (for the period ending 12/31/20) which reflected revenue and a corresponding account receivable related to this customer of $10,000 per month for services provided to this customer. Those financial statements also reflected the company’s standard allowance (reserve) amount on receivables, of 4% of sales. In total, your company’s average monthly sales amount to $500,000.

Required:

1. Evaluate whether receipt of this information indicates you have a change in accounting estimate or whether the customer’s bankruptcy should result in this event being considered an error in previously issued financial statements.

2. Next, describe the accounting treatment (as required by the Codification) for each alternative, then support your explanations with draft journal entries.

3. Finally, briefly state which treatment appears to be more appropriate given the circumstances. If you must make any assumptions in reaching this conclusion, state these.

You are the owner of a lawn service company (LawnCo) which provides grounds and maintenance services to a range of corporate customers. Customers are expected to pay on the first of each month, in advance of receiving services. One of your corporate customers is an eldercare facility whose grounds you have maintained for many years. The customer has not paid for the last three months of services (from Oct.–Dec. 2020); nevertheless, to maintain a positive relationship, your company continued to provide mowing and weed control services to the eldercare facility during that time. Your company ceased providing services in January 2021 and found out in that same month that the eldercare facility filed for bankruptcy in September. Your company now believes that collection of the missed payments is extremely unlikely.  Your company has already issued financial statements to lenders (for the period ending 12/31/20) which reflected revenue and a corresponding account receivable related to this customer of $10,000 per month for services provided to this customer. Those financial statements also reflected the company’s standard allowance (reserve) amount on receivables, of 4% of sales. In total, your company’s average monthly sales amount to $500,000.

Required:

1. Evaluate whether receipt of this information indicates you have a change in accounting estimate or whether the customer’s bankruptcy should result in this event being considered an error in previously issued financial statements.

2. Next, describe the accounting treatment (as required by the Codification) for each alternative, then support your explanations with draft journal entries.

3. Finally, briefly state which treatment appears to be more appropriate given the circumstances. If you must make any assumptions in reaching this conclusion, state these.

You are the owner of a lawn service company (LawnCo) which provides grounds and maintenance services to a range of corporate customers. Customers are expected to pay on the first of each month, in advance of receiving services. One of your corporate customers is an eldercare facility whose grounds you have maintained for many years. The customer has not paid for the last three months of services (from Oct.–Dec. 2020); nevertheless, to maintain a positive relationship, your company continued to provide mowing and weed control services to the eldercare facility during that time. Your company ceased providing services in January 2021 and found out in that same month that the eldercare facility filed for bankruptcy in September. Your company now believes that collection of the missed payments is extremely unlikely.  Your company has already issued financial statements to lenders (for the period ending 12/31/20) which reflected revenue and a corresponding account receivable related to this customer of $10,000 per month for services provided to this customer. Those financial statements also reflected the company’s standard allowance (reserve) amount on receivables, of 4% of sales. In total, your company’s average monthly sales amount to $500,000.

Required:

1. Evaluate whether receipt of this information indicates you have a change in accounting estimate or whether the customer’s bankruptcy should result in this event being considered an error in previously issued financial statements.

2. Next, describe the accounting treatment (as required by the Codification) for each alternative, then support your explanations with draft journal entries.

3. Finally, briefly state which treatment appears to be more appropriate given the circumstances. If you must make any assumptions in reaching this conclusion, state these.

Simmons Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equipment; Accounts Payable; Michael Short, Capital; Michael Short, Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense; Miscellaneous Expense.

Journalize the selected transactions for October 20Y3. If an amount box does not require an entry, leave it blank.

Revenue Management saves the business: the case of the National Car Rental

The story:​ National Rental Car faced disastrous possibilities. In 1993, General Motors had considered liquidating or selling the unprofitable business. National and their 7500 employees had just one chance. They had to make the business profitable and prove that the car rental business was worth saving.
National quickly brought in the help of specialists to assess the situation, understand the business and quantify revenue potential. Using the information gained from the evaluation, National began a revenue management system that would centralize their capacity management, pricing and reservations control.
The challenge​: Before National began using the Revenue Management System, it did not have the proper communication tools in place to be able to react to the industry’s changing environment and faced different issues
National did not pursue leisure weekend customers and remained solely focused on the business and corporate renters who paid fixed rates and only traveled during the week leaving most rental car companies with large fleets of idol cars on the weekends thus missing out on potential opportunities. National was not able to adjust for increased or decreased car demand as It planned its car fleet in one-year cycles as opposed to shorter cycles more often, which led to failure in meeting changing customer demand and tremendous number of missed opportunities. National’s pricing strategy also was not dynamic and was often linked to competitors pricing who were more flexible at making short-term pricing changes.
By using revenue management system, National was able to create a plan that would improve revenue per car, revenue per day, and utilization levels, thus could realize and sustain revenue improvements.
Questions:
1. Based on the above what are the problems National company had before applying Revenue management system? (30pts)

2. What conditions of the car rental industry encourage National company to implement revenue management practices? (35pts)
3. Using the information gained from the evaluation, how do you think the implementation of the revenue management system solved the problems of National and saved the company. (35 pts)

Journalize the five transactions for Mirmax Rentals described below:

August 1 Mirmax purchases two new saws on credit at $375 each. The saws are added to Mirmax’s rental inventory. Payment is due in 30 days.

August 8 Mirmax accepts advance deposits for tool rental of $75 that will be applied to the cash rental when the tools are returned.

August 15 Mirmax receives a bill from Macon Utility Company for $150. Payment is due in 30 days.

August 20 Mirmax charges Customers $750 for tool rentals. Payment is due in 30 days.

August 31 Mirmax receives $500 in payments from the customers that were bill for rentals on August 20.

Given the following balances for Garry’s Tree Service, prepare a Trial Balance

Financial Statements

Prepare an Income Statement, Statement of Owner’s Equity and Balance Sheet

Problem 3                              
Financial Statements                              
           Income Statement                  
                               
                              
                              
It should be in excel format could not upload the excel form that I had worked on boy should be in

Problem 3                              
Financial Statements      

Income Statement      
           Income Statement