A client heard through its hotline that John, the purchases journal clerk, periodically enters fictitious acquisitions. After John creates a fictitious purchase, he notifies Alice, the accounts payable ledger clerk, so she can enter them in her ledger. When the payables are processed, the payment is mailed to the nonexistent supplier’s address, a post office box rented by John. John deposits the check in an account he opened in the nonexistent supplier’s name.
Required
a. Define fraud, fraud deterrence, fraud detection, and fraud investigation.
b. List four personal (as opposed to organizational) fraud symptoms, or red flags, that indicate the possibility of fraud. Do not confine your answer to this example.
c. List two procedures you could follow to uncover John’s fraudulent behavior. (CIA Examination, adapted)

Answer: See explanation

Explanation:

a. Fraud is a criminal deception by someone which is done for either personal or financial gain.

Fraud deterrence is when the likely causes of fraud are identified and removed so as to prevent fraud from occuring.

Fraud detection are the activities that are done so as to prevent money or any other thing from being gotten by false pretenses.

Fraud investigation has to do with using investigative skills and accountability in order to know if fraud has taken place.

b. Fraud symptoms that indicate the possibility of fraud include:

1. Accounting and analytical anomalies

2. Tips and complaint

3. Extravagant lifestyle

4. Unusual behavior

c. The procedures that could be done to uncover John’s fraudulent behavior are:

• Stock reconciliation: This will help show the fictitious acquisitions. Since no receipt are given for the goods, this will help in the detection of the fraud.

• Alice should verify the details such as the address, phone number and name attached to the purchase and find a way of tracking it.

Robert has set-up a start-up business. You have been appointed as an accountant for his business. Prepare journal entries for the following
transactions
1. On January 1, 2015, Robert invested $50,000 in his business.
2. On January 4, 2015, Robert bought a laptop for $2,800 for business use.
3. On January 20, 2015, Robert received $13,000 for services rendered.
4. On January 23, 2015, Robert paid salaries to his staff for $3,500

In a company's SWOT analysis, which of the following is an example of a strength?
A.
A law is passed that decreases demand for the company's product.
B.
A demographic trend increases demand for the company's product.
C.
The company's employees are efficient and productive.
D.
The company doesn't have many competitors.

Telecomp is a U.S.-based manufacturer of cellular telephones. It is planning to build a new manufacturing and distribution facility in either South Korea, China, Taiwan, Poland, or Mexico. The cost of the facility will differ between countries and will even vary within countries depending on the economic and political climate, including monetary exchange rates. The company has estimated the facility cost (in $ millions) in each country under three different future economic/political climates as follows.Economic/Political Climate Country Decline Same Improve South Korea 21.7 19.1 15.2 China 19.0 18.5 17.6 Taiwan 19.2 17.1 14.9 Poland 22.5 16.8 13.8 Mexico 25.0 21.2 12.5 Determine the best decision using the following decision criteria. (Note that since the payoff is cost, the maximax criteria becomes minimax and maximin becomes minimax.)
a. Maximin
b. Minimax
c. Hurwicz ( 0.40)
d. Equal likelihood

A company purchased new furniture at a cost of $26,000 on September 30. The furniture is estimated to have a useful life of 5 years and a salvage value of $3,200. The company uses the straight-line method of depreciation. How much depreciation expense will be recorded for the furniture for the first year ended December 31

"What is the allowable MACRS depreciation on Evergreen’s property in the current year if Evergreen does not elect out of bonus depreciation?"

Canadians companies are free to charge whatever prices they wish. True or false

Find an approximate annual dollar-weighted yield received by Abiyote for the three-year period from January 1, 1994 until January 1, 1997 using

Fortuna Company issued 70,000 shares of $1 par stock, with a fair value of $5 per share, for 80% of the outstanding shares of Acappella Company. The firms had the following separate balance sheets prior to the acquisition:
Assets Fortuna Acappella
Current assets $2,100,000 $ 960,000
Property, plant, and equipment (net) 4,600,000 1,300,000
Goodwill -- 240,000
Total assets $6,700,000 $2,500,000
Liabilities and Stockholders' Equity
Liabilities $3,000,000 $ 800,000
Common stock ($1 par) 800,000
Common stock ($5 par) 200,000
Paid-in capital in excess of par 2,200,000 300,000
Retained earnings 700,000 1,200,000
Total liabilities and equity $6,700,000 $2,500,000
Book values equal fair values for the assets and liabilities of Acappella Company, except for the property, plant, and equipment, which has a fair value of $1,400,000. Compute goodwill or gain recognized in the consolidated statements .
Book values equal fair values for the assets and liabilities of Acappella Company, except for the property, plant, and equipment, which have a fair value of $1,600,000.Required:
a. What is the Goodwill/Gain associated with the acquisition:
b. What is the Non-Controlling Interest recorded in the consolidated balance sheet
c. What is the balance of the assets and liabilities side of the consolidated balance sheet after the acquisition:
d.Record the two elimination entries associated with the acquisition of the company

which situation best describes the role of businesse in the circular flow of goods

Fact Pattern: Dori Castings, a job-order shop, uses a full-absorption, standard-cost system to account for its production costs. The O/H costs are applied on a direct-labor-hour basis.
The amount of fixed factory O/H that Dori will apply to finished production is the:_______.
A. Standard allowed direct labor hours for the actual units of finished output times the standard fixed factory O/H rate per direct labor hour.
B. Actual fixed factory O/H cost per direct labor hour times the standard allowed direct labor hours.
C. Actual direct labor hours times the standard fixed factory O/H rate per direct labor hour.
D. Standard units of output for the actual direct labor hours worked times the standard fixed factory O/H rate per unit of output.

North Star prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.
Account Titles Debit Credit
Cash $ 11,200
Accounts Receivable 5,200
Prepaid Rent 2,240
Equipment 20,200
Accumulated Depreciation $ 1,180
Accounts Payable 1,180
Income Tax Payable 0
Common Stock 24,000
Retained Earnings 1,300
Sales Revenue 47,080
Salaries and Wages Expense 24,200
Utilities Expense 11,700
Rent Expense 0
Depreciation Expense 0
Income Tax Expense 0
Totals $ 74,740 $ 74,740
Other data not yet recorded at December 31:
1. Rent expired during the year, $1,120.
2. Depreciation expense for the year, $1,180.
3. Utilities used and unpaid, $8,200.
4. Income tax expense, $310.
Required:
Indicate the accounting equation effects of each required adjustment. (Enter all amounts as positive values.)

Which drawback of being an entrepreneur can disrupt your personal life?

The following is a comprehensive problem which encompasses all of the elements learned in previous chapters. You can refer to the objectives for each chapter covered as a review of the concepts. Note: You must complete parts 1, 2, 3, 4 before completing part 5.
Part 5: Enter the unadjusted trial balance on an end-of-period spreadsheet (work sheet) and complete the spreadsheet using the following adjustment data.
Insurance expired during May is $275.
Supplies on hand on May 31 are $715.
Depreciation of office equipment for May is $330.
Accrued receptionist salary on May 31 is $325.
Rent expired during May is $1,600.
Unearned fees on May 31 are $3,210.
If an amount box does not require an entry, leave it blank or enter "0".
Kelly Consulting
End-of-Period Spreadsheet (Work Sheet)
For the Month Ended May 31, 20Y8
Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet
Account Title Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash
Accounts Receivable
Supplies
Prepaid Rent
Prepaid Insurance
Office Equipment
Accum. Depreciation
Accounts Payable
Salaries Payable
Unearned Fees
Common Stock
Retained Earnings
Dividends
Fees Earned
Salary Expense
Rent Expense
Supplies Expense
Depreciation Expense
Insurance Expense
Miscellaneous Expense
Net income

Forest Components makes aircraft parts. The following transactions occurred in July. Purchased $16,950 of materials on account. Issued $16,780 in direct materials to the production department. Issued $1,340 of supplies from the materials inventory. Paid for the materials purchased in transaction (1) using cash. Returned $2,020 of the materials issued to production in (2) to the materials inventory. Direct labor employees earned $32,500, which was paid in cash. Purchased miscellaneous items for the manufacturing plant for $17,250 on account. Recognized depreciation on manufacturing plant of $36,700. Applied manufacturing overhead for the month. Forest uses normal costing. It applies overhead on the basis of direct labor costs using an annual, predetermined rate. At the beginning of the year, management estimated that direct labor costs for the year would be $434,600. Estimated overhead for the year was $412,870. The following balances appeared in the inventory accounts of Forest Components for July.
Beginning Ending
Materials Inventory ? $12,490
Work-in-Process Inventory ? 10,560
Finished Goods Inventory $2.700 6.930
Cost of Goods Sold ? 75,1000
a. Prepare Journal Entries to record these transactions (1-9)
b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold

The adjusted trial balance of Dawson Company contained the following information. Assume the tax rate is 33%:
Debit Credit
Sales revenue $425,000
Sales returns and allowances $ 20,000
Sales discounts 5,000
Cost of goods sold 300,000
Operating expenses 61,000
Interest revenue 2,000
Interest expense 1,000
Compute the gross profit. rate(%)

The following trial balance of Crane Co. does not balance.
CRANE CO.
TRIAL BALANCE
JUNE 30, 2017
Debit Credit
Cash $3,099
Accounts Receivable $3,460
Supplies 1,029
Equipment 4,029
Accounts Payable 2,895
Unearned Service Revenue 1,429
Common Stock 6,229
Retained Earnings 3,229
Service Revenue 2,609
Salaries and Wages Expense 3,629
Office Expense 1,169
Totals $14,745 $18,061
Each of the listed accounts should have a normal balance per the general ledger. An examination of the ledger and journal reveals the following errors.
1. Cash received from a customer on account was debited for $570, and Accounts Receivable was credited for the same amount. The actual collection was for $750.
2. The purchase of a computer printer on account for $729 was recorded as a debit to Supplies for $729 and a credit to Accounts Payable for $729.
3. Services were performed on account for a client for $890. Accounts Receivable was debited for $890 and Service Revenue was credited for $89.
4. A payment of $294 for telephone charges was recorded as a debit to Office Expense for $294 and a debit to Cash for $294.
5. When the Unearned Service Revenue account was reviewed, it was found that service revenue amounting to $554 was performed prior to June 30 (related to Unearned Service Revenue).
6. A debit posting to Salaries and Wages Expense of $899 was omitted.
7. A payment on account for $206 was credited to Cash for $206 and credited to Accounts Payable for $260.
8. A dividend of $804 was debited to Salaries and Wages Expense for $804 and credited to Cash for $804.
Prepare a correct trial balance.
CRANE CO.
TRIAL BALANCE
JUNE 30, 2017
Debit
Credit $ $
Totals $ $

Vaughn Manufacturing has a weighted-average unit contribution margin of $30 for its two products, Standard and Supreme. Expected sales for Vaughn are 60000 Standard and 40000 Supreme. Fixed expenses are $1500000. How many Standards would Vaughn sell at the break-even point?

Terrill Company finds its records are incomplete concerning a piece of machinery used in its plant. According to the company records, the machinery has an estimated useful life of 10 years and an estimated salvage value of $ 24,000. It has recorded $ 12,000 in depreciation each year using the straight-line method. If the accumulated depreciation account shows a balance of $ 72,000, what is the original cost of the machinery and how many years remain to be depreciated?

According to Joseph​ Schumpeter, what does economic progress depend​ on? A. technological change in the form of new products B. ​competition, especially price competition C. the initial endowment of economic​ resources, such as the amount of labor and capital available D. government protection of competition

Andreasen Corporation manufactures thermostats for office buildings. The following is the cost of each unit:
Materials $ 36.00
Labor 14.00
Variable overhead 4.00
Fixed overhead ($1,800,000 per year; 100,000 units per year) 18.00
Total $ 72.00
Simpson Company has approached Andreasen with an offer to buy 7,500 thermostats at a price of $60 each. The regular price is $100. Andreasen has the capacity to produce the 7,500 additional units without affecting its current production of 100,000 units. Simpson requires that each unit use its branding, which requires a more expensive label, resulting in an additional $2 per unit material cost. The labor cost of affixing the label will be the same as for the current models. The Simpson order will also require a one-time rental of packaging equipment for $20,000.
Required:
a. Prepare a schedule to show the impact of filling the Simpson order on Andreasen’s profits for the year. (Enter your answers in thousands (i.e., 5,400,000 should be entered as 5,400). Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.)
Status quo 100,000 units Alternative 107,500 units Difference Higher or lower

Sales Revenue ? ? ? ?
Less: variable cost ? ? ? ?
Materials ? ? ? ?
Labor ? ? ? ?
Variable Overhead ? ? ? ?
Total variable cost ? ? ? ?
Contribution margin ? ? ? ?
Less; fixed costs ? ? ? ?
Operating profit or loss ? ? ? ?
b. Do you agree with the decision to accept the special order. Yes or no?
c. Considering only profit, determine the minimum quantity of thermostats in the special order that would make it profitable, assuming capacity is available.... Quanitity of Themostats #___?____ units

Which costs are variable costs?
A. Rent
B. Machinery
C. Raw material
D. Marketing
E. Monthly salary

Describe a scenario in which you thought you were making a good decision but there was still a negative outcome.

Your parts supplier gives you one-quarter of a year to pay for parts ordered today, or offers you a discount if you pay cash at purchase. You have just purchased $94,500 worth of parts from your supplier and the discount is at an annual rate of 10%. How much will you pay for the parts if you pay today

On December 31, 2017, Wayne Sparks Company had 600,000 shares of common stock issued and outstanding. Sparks issued a 5% stock dividend on June 30, 2018. On September 30, 2018, 20,000 shares of common stock were reacquired as treasury stock. What is the appropriate number of shares to be used in the basic earnings per share computation for 2018

The operations of Winston Corporation are divided into the Blink Division and the Blur Division. Projections for the next year are as follows:

Blink Division Blur Division Total
Sales $280,000 $168,000 $448,000
Variable costs 98,000 77,000 175,000
Contribution margin $182,000 $91,000 $273,000
Direct fixed costs 84,000 70,000 154,000
Segment margin $98,000 $21,000 $119,000
Allocated common costs 42,000 31,500 73,500
Operating income (loss) $56,000 ($10,500) $45,500

Operating income for Winston Corporation as a whole if the Blur Division were dropped would be:

a. $66,500.
b. $56,000.
c. $45,500.
d, $24,500.

Thomas, a senior manager at a manufacturing firm, is coming up with
ideas for a new product. Thomas has made a list of the following tasks that form a part of this project, along with their respective durations.
Create questionnaires to interview potential customers (7 days)
Find existing information about the market from online sources and trade journals (6 days)
Interview the respondents with the help of the questionnaire (10 days)
Design a new product according to the information obtained through the interviews (30 days)
If Thomas conducts a Critical Path Analysis to schedule these activities, what is the most likely duration that the activities will take to be completed?
A. 50 days
B. 40 days
C. 57 days
D. 47 days
E. 67 days

For each of the situations​ listed, identify the primary standard from the IMA Statement of Ethical Professional Practice that is violated​ (competence, confidentiality,​ integrity, or​ credibility).

1. To reduce the company's tax bill, Jack uses total cost to value inventory instead of using product cost as required by law.
2. Since Emilie works in the accounting department, she is aware that profits are going to fall short of analysts' projections. She tells her aunt to sell stock in the company before the earnings release date.
3. Veronica pays a Mexican official a bribe of $50,000 to allow the company to locate a factory in that jurisdiction so that the company can take advantage of the cheaper labor costs. Without the bribe, the factory cannot be located in that location.
4. There is a failure in the company's backup system after a system crash. Month-end reports will be delayed. Kayla, the manager of the division experiencing the system failure, does not report this upcoming delay to anyone since she does not want to be the bearer of bad news.

World Company expects to operate at 80% of its productive capacity of 67,500 units per month. At this planned level, the company expects to use 32,400 standard hours of direct labor. Overhead is allocated to products using a predetermined standard rate of 0.600 direct labor hour per unit. At the 80% capacity level, the total budgeted cost includes $68,040 fixed overhead cost and $408,240 variable overhead cost. In the current month, the company incurred $472,000 actual overhead and 29,400 actual labor hours while producing 51,000 units.

Required:
a. Compute the overhead volume variance.
b. Compute the overhead controllable variance.

Which option enables you to keep the last grammatical change?​

The following is selected information from Bonita Corporation for the fiscal year ending October 31, 2018
Cash received from customers $301000
Revenue recognized 376000
Cash paid for expenses 184000
Cash paid for computers on November 1, 2017 that will be used for 3 years (annual depreciation is $16100) 48300
Expenses incurred, including interest, but excluding any depreciation 218000
Proceeds from a bank loan, part of which was used to pay for the computers 95000
Based on the accrual basis of accounting, what is Monty Corporation’s net income for the year ending October 31, 2018?