Question: You are the assistant controller for a public company Wall
You are the assistant controller for a public company. Wall Street stock analysts are projecting an earnings per share figure of $0.25 for your company. On December 29, a large customer returns a very large shipment of your goods that were defective. You tell the controller about the customer return and that the debit to sales returns and allowances will have the effect of reducing earnings per share from $0.25 to $0.24. The controller indicates that failing to meet the consensus earnings expectations of the analyst community will result in a large stock price decline. The controller suggests waiting until January 2 (your company operates on a calendar year-end basis) to record the customer return. What should you do?
Answer to relevant QuestionsAs a fund-raiser, the pep band at Melrose University sells T-shirts fans can wear when attending the school’s 12 home basketball games. As the band’s business manager, you must choose among several options for ordering ...Frisbee Hardware uses a perpetual inventory system. At year-end, the Inventory account has a balance of $250,000, but a physical count shows that the merchandise on hand has a cost of only $246,000.a. Explain the probable ...Mountain Mabel’s is a small general store located just outside of Yellowstone National Park. The store uses a periodic inventory system. Every January 1, Mabel and her husband close the store and take a complete physical ...King Enterprises is a book wholesaler. King hired a new accounting clerk on January 1 of the current year. The new clerk does not understand accrual accounting and recorded the transactions below based on when cash receipts ...Computer Resources Inc. is a computer retailer. Computer Resources began operations in December of the current year and engaged in the following transactions during that month. Computer Resources uses a perpetual inventory ...
Post your question