All applicable cases are available with McGraw-Hill ’s Connect™ Accounting. CASE 10B–5 Ethics and the Manager; Rigging Standards [LO5] Stacy Cummins‚ the newly hired controller at Merced Home Products‚ Inc.‚ was disturbed by what she had discovered about the standard costs at the Home Security Division. In looking over the past several years of quarterly earnings reports at the Home Security Division‚ she noticed that the first-quarter earnings were always poor‚ the second-quarter earnings were
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The rise and fall of Enron is a company that was lead to its own demise by it’s own leadership and ill business decisions. The motivational theories explained from the readings of Organization Behavior can correlate with the failure of Enron’s internal organization. Even though a company may appear to display successful business practices‚ the influence of leadership through management can ultimately lead the company to fail. Enron’s code of ethics prided itself on four key values; respect‚ integrity
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MEMO: LabCo must determine if their accounting policy for the revenue treatment of its construction contracts is reasonable‚ if it is appropriate for LabCo to change its method of accounting for the Halibut contract from the percentage-of-completion method to the completed-contract method and how the change should be treated on the basis of the guidance provided within ASC 250‚ and how LabCo’s accounting policy and accounting for the Halibut contract may change under IFRS if adopted in the coming
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settle the obligation; and (c) a reliable estimate can be made.” When it is not clear if there is a present obligation‚ IAS 37-15 also defines a present obligation as obligation that “more or likely than not is risen by a past event after taking accounting of all available evidence”. Moreover‚ IAS 37-22 also specifically provides that “where details of a proposed new law have yet to be finalized‚ an obligation arises only when the legislation is virtually certain to be enacted as drafted”. As it is
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A business model of the times The Enron bubble was a prime example of the dominance of speculative finance in business. V. SRIDHAR MORE than two months after Enron‚ the seventh biggest corporation in the United States‚ filed for bankruptcy‚ the stench of scandal refuses to die. Shocking revelations about the company’s modus operandi continue to pour in. Public and media attention was initially focussed on the company’s close ties with the political establishment and the policy-making bureaucracy
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A Questionable Drug: Depo Provera For decades‚ Depo Provera has been used around the world‚ not always for the same purpose. The drug‚ medroxyprogesterone acetate‚ more commonly known as Depo Provera‚ was originally made to be an injectable form of long-term birth control. When Depo was first approved in the US as an effective form of birth control this seemed liked a miracle drug for women. You would not have to remember to take a pill every morning‚ fewer side effects‚ even a shorter
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it was the "Greed Factor" which drives Enron employees to increase the profits through unethical methods‚ and ultimately causing its downfall. But could it be the opposite? I mean‚ could it be that it was Enron ’s culture and Key Performance Indicators (KPIs)‚ which is to increase the profits and share price that "forced" Enron employees behave in an unethical manner? What circumstances caused them to be unethical‚ really? At first‚ the leader of Enron Finance Corp‚ Jeffrey Skilling recruited
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Many have heard of the Enron Scandal of 2001. A scandal‚ by definition‚ is an event that involves allegations of wrongdoing‚ disgrace‚ or moral outrage. In other words‚ a scandal is caused by shortcomings in ethics. Enron’s Ken Lay‚ Jeffrey Skilling and Andrew Fastow each engaged in unethical practices in their various leadership positions at Enron and caused thousands of Enron employees and investors to lose their savings. (Smartest) Kenneth Lay showed all the signs of a transformational
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Case #2: due on April 8th “Understanding the Clients Environment and Client’s Risks” Case 2.4 2 students will present But all students will turn this in as part of homework grading. Questions to be answered: Question # 1 (student 1) and Question # 2 and 3 (student 2). A little background to get you started. 1. Asher Farms’ common stock is traded on the NASDAQ national market with an aggregate market value of $677 million on October 31‚ 2011. 2. Asher Farms‚ Inc. is a fully-integrated
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Abstract Enron became one of the largest natural gas and energy trading companies in the world. During the 90 ’s Enron was considered as an innovative company within the global business market. Enron was known for its unique innovative technologies and distinctive approach to trading in the world of e-commerce. On December 2‚ 2001‚ Enron announced the biggest bankruptcy in history and when many people hear the word‚ Enron they associate it with the one of the most important accounting scandals in
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