Homework_1_Solutions

Homework_1_Solutions - Homework 1 Solutions 1-23...

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Homework 1 Solutions 1-23 Professional ethics and reporting division performance. 1. Miller’s ethical responsibilities are well summarized in the IMA’s “Standards of Ethical Conduct for Management Accountants” (Exhibit 1-7 of text). Areas of ethical responsibility include the following: competence confidentiality integrity objectivity The ethical standards related to Miller’s current dilemma are integrity, competence and objectivity. Using the integrity standard, Miller should communicate unfavorable as well as favorable information and professional judgments or opinions. Competence demands that Miller perform her professional duties in accordance with relevant laws, regulations, and technical standards. Objectivity requires that Miller report information fairly and objectively. Miller should refuse to book the $200,000 of sales until the goods are shipped. Both financial accounting and management accounting principles maintain that sales are not complete until the title is transferred to the buyer. 2. Miller should refuse to follow Maloney's orders. If Maloney persists, the incident should be reported to the corporate controller. Support for line management should be wholehearted, but it should not require unethical conduct. 2-30 Computing cost of goods purchased and cost of goods sold. (a) Marvin Department Store Schedule of Cost of Goods Purchased For the Year Ended December 31, 2008 (in thousands) Purchases $155,000 Add transportation-in 7,000 162,000 Deduct: Purchase return and allowances $4,000 Purchase discounts 6,000 10,000 Cost of goods purchased $152,000 (b) Marvin Department Store Schedule of Cost of Goods Sold For the Year Ended December 31, 2008 (in thousands) Beginning merchandise inventory 1/1/2008 $ 27,000 Cost of goods purchased (above) 152,000 Cost of goods available for sale 179,000 Ending merchandise inventory 12/31/2008 34,000 Cost of goods sold $145,000
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2-32 Income statement and schedule of cost of goods manufactured. Howell Corporation
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Homework_1_Solutions - Homework 1 Solutions 1-23...

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