JOSIE, AN ACCOUNTING SUPERVISOR IN MONK & SONS REALTY, INSTRUCTS MARIA ANSWER
Josie, an accounting supervisor in Monk & Sons Realty, instructs Maria, her employee, to make certain accounting entries in the company's books that will increase revenue. Maria researches the matter, confirming her concern that these entries would overstate revenue, and informs Josie that recognizing revenue in this manner would be premature and not consistent with generally accepted accounting principles (GAAP) but Josie disagrees and insists that Maria record the entries. The amount of revenue is material to Monk's financial statements. According to the AICPA rules, what should Maria do first? Sarah, the controller of a large beverage supplier, supervises two employees. Her boss, Vladimir, instructs her to increase the company's inventory balance for an amount that is material to the financial statements by crediting several small "miscellaneous" expense accounts. She does not understand why he wants her to make these entries but immediately directs one of her staff to make them because she has been instructed to do so. Which of the following statements best describes Sarah's actions? 1. Which of the following statements best describes how the International Federation of Accountants' (IFAC's) rules and standards impact the U.S. accounting profession?
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- January 4, 2022
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