75 Word Minimum
Annette Kagel opened Harre Real Estate Co. on January 1, 2007. At the end of the first year, the business needed additional capital. On behalf of Harre Real Estate, Annette applied to Lake County State Bank for a loan of $200,000. Based on Harre Real Estate’s financial statements, which had been prepared on a cash basis, the Lake County State Bank loan officer rejected the loan as too risky.
After receiving the rejection notice, Annette instructed her accountant to prepare the financial statements on an accrual basis. These statements included $31,500 in accounts receivable and $10,200 in accounts payable. Annette then instructed her accountant to record an additional $10,000 of accounts receivable for commissions on property for which a contract had been signed on December 28, 2007, but which would not be formally “closed” and the title transferred until January 5, 2008.
Annette then applied for a $200,000 loan from First National Bank, using the revised financial statements. On this application, Annette indicated that she had not previously been rejected for credit.
Do you feel that Annette is acting ethically? As the accountant in this situation, how do you explain the discrepancy in the numbers? How would you explain the differences between cash basis and accrual basis? Is it possible to have a net income in one situation and a net loss in another situation? How would you have handled this situation differently?
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Place Order” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.