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Ugly Puppy 2 - Accounting Choices Reader Chapter 6 Appendix...

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Accounting Choices Reader  Chapter 6 Appendix F Ugly Puppy Period 2 Econ/Mgmt 4 May 9, 2011
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Next?    Exploring some of the subtleties in  applying a principles-based approach –  accrual  .  How management can influence perceived  performance. Learning the details and the consequences  of accounting choices.
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A Few Observations We may have two sets of Financials , but We have  only one business ! Thus, we have created a reporting  form That is different from the  substance  of events  – does this matter?  How? The one reported item that cannot be altered by  Accounting Choices is  CA$H .
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2 nd  Period Events    Purchase  10 T-shirts @ $4 each, pay cash . Borrow  $100 @ 10% interest on an interest-only  basis with interest due in subsequent periods. Take  the puppy to a Vet and a Trainer and pay $60  cash.    Consult  40 clients and 30 pay $1 each; 10 promise  to pay later.  Sell  10 T-shirts at $5 each in cash. Encounter  a person who agrees to $100 for a Puppy  appearance – next period – and pays $50 cash now  with balance due  on delivery of the Puppy  performance .
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2 nd  Period Events – Cash Journal    Starting Cash.
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