Read and respond to ATC 7-7 on page 285. This situation is similar to the Enron scandal from several years ago. Use the College Online Library to research Enron accounting procedures. (Link posted below) In your post, discuss how these accounting procedures affected the company and stockholders.
2. Corporations and Partnerships
Read and respond to ATC 8-6 on page 319. In your post, describe the advantages and disadvantages of organization forms. Include why most large public health care organizations use the corporate form.
ATC 7-7 Corporate Governance Sometimes debt is not debt
David Sheridan was a well-respected CPA in his mid-fifties. After spending 10 years at a na- o tional accounting firm, he was hired by Global, Inc., a multinational corporation headquar- tered in the United States. He patiently worked his way up to the top of Globals accounting pr department and in the early 1990s, took over as chief financial officer for the company. As the
Internet began to explode, management at Global, Inc., decided to radically change the nature of its business to one of e-commerce. Two years after the transition, Internet commerce began to slow down, and Global was in dire need of cash in order to continue operations. Manage- ment turned to the accounting department.
Global, Inc., needed to borrow a substantial amount of money but couldnt afford to in- crease the amount of liabilities on the balance sheet for fear of the stock price dropping and banks becoming nervous and demanding repayment of existing loans. David discovered a way that would allow the company to raise the needed cash to continue operations without having to report the long-term notes payable on the balance sheet. Under an obscure rule, companies can set up separate legal organizations that do not have to be reported on the parent companys financial statements, if a third party contributes just 3 percent of the start-up capital. David called a friend, Brian Johnson, and asked him to participate in a business venture with Global. Brian agreed, and created a special purpose entity with Global named BrianCo. For his par- ticipation, Brian was awarded a substantial amount of valuable Global stock. Brian then went to a bank and used the stock as collateral to borrow a large sum of money for BrianCo. Then, Global sold some of its poor or underperforming assets to BrianCo for the cash that Brian borrowed. In the end, Global got rid of bad assets, received the proceeds of the long-term note payable, and did not have to show the liability on the balance sheet. Only the top executives and the accountants that worked closely with David knew of the scheme, and they planned to use this method only until the e-commerce portion of Global became profitable again.
Edmonds, Thomas. Survey of Accounting, 2nd Edition, 2nd Edition. McGraw-Hill Primis Custom Publishing. <vbk:0390124117#page(303)>.
2# Corporations and Partnerships
“ATC 8-6 Comparison of organizational forms
Jim Baku and Scott Hanson are thinking about opening a new restaurant. Baku has extensive marketing experience but does not know that much about food preparation. However, Hanson is an excellent chef. Both will work in the business, but Baku will provide most of the funds necessary to start the business. At this time, they cannot decide whether to operate the business as a partnership or a corporation.
Prepare a written memo to Baku and Hanson describing the advantages and disadvantages of each organizational form. Also, from the limited information provided, recommend the or- ganizational form you think they should use”
Edmonds, Thomas. Survey of Accounting, 2nd Edition, 2nd Edition. McGraw-Hill Primis Custom Publishing. <vbk:0390124117#page(337)>.
At 111papers.com, we value all our customers, and for that, always strive to ensure that we deliver the best top-quality content that we can. All the processes, from writing, formatting, editing, and submission is 100% original and detail-oriented. With us, you are, therefore, always guaranteed quality work by certified and experienced writing professionals. We take pride in the university homework help services that we provide our customers.
As the best homework help service in the world, 111 Papers ensures that all customers are completely satisfied with the finished product before disbursing payment. You are not obligated to pay for the final product if you aren’t 100% satisfied with the paper. We also provide a money-back guarantee if you don’t feel that your paper was written to your satisfaction. This guarantee is totally transparent and follows all the terms and conditions set by the company.Read more
All products that we deliver are guaranteed to be 100% original. We check for unoriginality on all orders delivered by our writers using the most advanced anti-plagiarism programs in the market. We, therefore, guarantee that all products that we submit to you are 100% original. We have a zero-tolerance policy for copied content. Thanks to our strict no plagiarized work rule, you can submit your homework to your professor without worrying.Read more
TThis is one of the most cherished courtesy services that we provide to help ensure that our customers are completely satisfied with our finished products. Delivering the best final product to our customers takes multiple inputs. 111papers.com prides itself on delivering the best university homework help services in the writing industry. And, in part, our free revision policy is how we do it. What’s more, all our revisions are 100% free without any strings attached.Read more
Client privacy is important to use. We know and understand just how important customers value their privacy and always want to safeguard their personal information. Thus, all the information that you share with us will always remain in safe custody. We will never disclose your personal information to any third party or sell your details to anyone. 111 Papers uses the most sophisticated, top-of-the-line security programs to ensure that our customers’ information is safe and secured.Read more
Placing your order with us means that you agree with the homework help service we provide. We, in turn, will endear to ensure that we do everything we can to deliver the most comprehensive finished product as per your requirements. We will also count on your cooperation to help us deliver on this mandate. Yes, we also need you to ensure that you have the highest-quality paper.Read more