If the customer does have bad credit then it’s up to you to take the chance and offer your services. It is sometimes not so good to turn down customers due to a bad credit report because it can cause you a chance to blow a great business deal. But also Keep in mind that if they already have a problem with paying bills and if you choose to still do business with them you can set up a payment arrangement to have the bill automatically drafted out of the account every pay period. This way the payment is never late. This is sometimes the best route to go rather you are bad with paying bills or not.
According to Schroeder, Clark, & Cathey (2011), a contingency is a future event that could have an impact on the business. The “concern has been that disclosures under the current standard do not provide enough information to allow those who use the financial statements, such as investors to adequately assess the likelihood, timing and amount of liability related to the loss contingency” (Holme, C.). When a loss is possible, we can report the contingency financial statements—the statements do not reflect
However, people should have the notion that the life does not work in the idea of "I want", but more of in the idea of "I am able to". The main factors that contribute to a person falling into debt are failure of control of ones personal finance and loans in banks with interest. The absence of control in the budget is the first step to having problems with debt and
A customer is not liable for the amount of the overdraft if the customer did not sign or benefitted from the proceeds of the action. §4-401(b) This is a difficult scenario, the bank may be forced to re-credit Smiths account the $495. Is the bank without a remedy? According to 4-208: When a check is deposited into a bank and sent through to the bank upon which it is drawn, the depositary bank warrants that the item has not been altered and that it is entitled to enforce the instrument. If there is a problem with the indorsements, or if the check has been altered, the payor bank can bring a claim against the depositary bank for breach of the warranty.
(b) What are the ethical issues involved in this situation? The ethical issues involved in this situation pertain to following accepted accounting principles. Violating the generally accepted accounting principles to satisfy a short-term personal or company would create misleading financial statements. This situation would therefore be unethical. Robbin Industries is jeopardizing itself by not properly reporting the advertising costs.
Material participation is a concept used by the law to determine what qualifies as a passive activity. A passive activity is defined as any business or trade activity that the taxpayer does not materially participate in running. Therefore, material participation as a concept helped with the difficulty in dealing with such a subjective issue. It is important to distinguish passive income from active income, since losses are treated differently under each classification on the taxpayer’s tax return. Problems:
Since the Walton Work Wear line is in the production stage, its accumulated development costs should be capitalized. The Carroway Cool Top has not started it commercial production which would allow the development costs not to be amortized yet. Also interest costs on loans to generate financing for the R&D activates of a product can be capitalized rather than expensed. The capitalization of interest would allow CCL to reduce taxable income in the future when it is more profitable. I would recommend that CCL make the above changes immediately so that the financail statements are not incorrect.
b. Indirect interest must be impartial, so independence is also impaired in this case. c. Independence is impaired if the CPA had any loan to or form the client, except “grandfathered loans” or other permitted loans. Grandfathered loans are loans acquired before the requirement for independence. Other permitted loans are new loans obtained under “normal” lending procedures.
In illustration, with the benefit of credit cards, people are offered loans which are unlikely to be paid back. Therefore, psychological biases are shared with creditors and debtors. Such biases that are created in decision making controls the human mind. This leads to how an individual judge events and decisions. As the title itself, the author defines empathy as the capacity of “feeling” the other person, being able to share her feelings by putting oneself in the other person’s point of view.
While this situation may not impact the average consumer, companies that engage in foreign transactions with international companies could face losses, and gains, due to changes in the foreign currency exchange rate. US companies that do business with foreign companies have to be careful to not incur losses when making purchases or sales due to fluctuating foreign currency exchange rates. A company may make use of derivatives to minimize transaction exposure losses when engaging in business with foreign companies and currencies. The use of a derivative by a company who is trying to insulate itself against this type of loss is called hedging. Although hedging has its supporters and detractors, as well as its advantages and disadvantages, it is a common practice in our global business world today.