Prepare a report of about 300 words in which you summarize each questions argument?
1) On February 5, 2010, Tropical Connection Company, a garden retailer, purchased $25,000 of seed, terms 2/10, n/30, from Midwest Seed Co. Even though the discount period had expired, Lydia DeLay subtracted the discount of $500 when she processed the documents for payment on March 16, 2010. -Discuss whether Lydia Delay behaved in a professional manner by subtracting the discount, even though the discount period had expired. -What would you do? -How should Midwest handle this payment and the irregular use of the discount?
2) During the preparation of the bank reconciliation for New Concepts Co., Peter Fikes, the assistant controller, discovered that City National Bank incorrectly recorded a $710 check written by New Concepts Co. as $170. Peter has decided not to notify the bank but wait for the bank to detect the error. Peter plans to record the $540 error as Other Income if the bank fails to detect the error within the next three months. -Discuss whether Peter is behaving in a professional manner. What would you do? -As Peter's supervisor how would you handle this situation if you found out what Peter had done? -How would you explain the need for this to be handled correctly? -Why are bank reconcilations so important?
3) Mirna Gaymar, VP of operations for Rocky Mountain County Bank, has instructed the bank's computer programmer to use a 365-day year to compute interest on depository accounts (payables). Mirna also instructed the programmer to use a 360-day year to compute interest on loans (receivables). -Discuss whether Mirna is behaving in a professional manner. -Does this really make a difference? -What would you do if you Mirna? -What would you do if you were Mirna's supervisor?
4) Leah Corbin, CPA, is an assistant to the controller of Beartooth Consulting Co. In her spare time, Leah, also prepares tax returns and performs general accounting services for clients. Frequently, Leah performs these services after her normal working hours, using Beartooth Consulting's computers and laser printers. Occasionally, Leah's clients will call her at the office during regular office hours. -Discuss whether Leah is performing in a professional manner. -What would you do if you were Leah? -What would you do if you were Leah's supervisor and this came to your attention? And why?