Week 8 assignment – litigation, censures, and fines

 

Week 8 Assignment – Litigation, Censures, and Fines

Overview

You  are the accountant for ACC KarParts, a thriving company that  makes auto parts. You oversee all accounting functions within the  company. Quinn, your supervisor, has informed you that if the company’s  profits grow by 30% this year, you will receive a $30,000 bonus, and she  will receive a $60,000 bonus. No bonuses will be awarded if profit  growth is less than 30%. Near the end of this fiscal year, the two of  you have the following conversation: 

  • Quinn: We  are getting close to 28% profit by the end of this year. If this  happens, neither you nor I will get any bonus. What can be done to reach  our target and get our bonus? 
  • You: There is nothing we can do to reach 30% profit this year. However, we can plan to reach that target next year. 
  • Quinn: If we claim some of the next year revenues  to be part of the current year, you will get your bonus, I will get  mine, and the investors will be happier. Therefore, everybody will be  happy. 
  • You: Uh, Quinn, that would be  an unethical action. 
  • Quinn: We are simply moving revenue from one period to another. We are not faking the revenue transactions. 

As an accountant, what would you do in this situation? 

Instructions

Write a 2–3 page report explaining to Quinn why you can’t move revenue from one period to another. In the report: 

  1. Explain the importance of ethics in accounting.
  2. Apply ethical principles and professionalism to the case at ACC KarParts.  
  3. Based on generally accepted accounting principles, recommend at least three acceptable legal alternatives to meet company goals.
  4. Use  three sources to support your writing. Choose sources that are  credible, relevant, and appropriate. Cite each source listed on your  source page at least one time within your assignment. For help with  research, writing, and citation, access the library, or review library guides.

This course requires the use of Strayer Writing Standards. For  assistance and information, please refer to the Strayer Writing  Standards link in the left-hand menu of your course. Check with your  professor for any additional instructions.

The specific course learning outcome associated with this assignment is:

  • Evaluate a business’s accounting system for compliance with accounting principles, regulations, and ethical business practices.

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