Richard’s Dilemma Bongo Plus was formed in February 2014 with


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Need tutoring help with this Cost Accounting assignment. After reading the case you are to come up with three possible scenarios of what Richard should do. Each scenario should clearly state Richard’s course of action as well as the advantages and disadvantages of such action. After presenting the three possible scenarios you are to pick one as a recommended course of action and justify why you feel this course is the one Richard should choose. Your grade will be determined by your analysis of the advantages and disadvantages of the scenarios as well as your justification of which scenario Richard should pursue. Professional presentation, including correct grammar and spelling will also factor into your final grade. All submissions must be in a Word file. Topics covered in class thus far: Cost Classifications for Assigning Costs to Cost Objects Cost Classifications for Manufacturing Companies Cost Classifications for Preparing Financial Statements Cost Classifications for Predicting Cost Behavior The Analysis of Mixed Costs Traditional and Contribution Format Income Statements Cost Classifications for Decision Making Job-Order Costing—An Overview Job-Order Costing—An Example Job-Order Costing—The Flow of Costs Schedules of Cost of Goods Manufactured and Cost of Goods Sold Underapplied and Overapplied Overhead—A Closer Look Job-Order Costing in Service Companies Comparison of Job-Order and Process Costing Cost Flows in Process Costing Equivalent Units of Production Compute and Apply Costs Operation Costing InfoFile.pdf Richard’s Dilemma Bongo Plus was formed in February 2014 with the goal of selling advertising trinkets to local businesses. Bongo Plus is a small, privately­held company that does not yet have a Board of Directors. Bongo’s main competitive advantage is that the company is local and the founder and president, David Fritz, is well known and trusted in the local business community. He worked in corporate advertising before starting Bongo Plus. Fritz hired Lisa Stone to run Bongo Plus. Richard Temple, an accountant who holds both the CPA and CMA certifications, was hired by Lisa to set up a computerized system to track incoming orders, inventory, sales, cash receipts and payments for the business. Bongo Plus raised $500,000 from local investors to begin operations. These investors were given an equity state in the company in return for their investment. From the very beginning the investors were concerned with the company’s ability to attract repeat customers and earn profits. However, $99,725 net income had been recorded in the company’s first year which ended January 31, 2015. This relieved most of the investor’s concern about the company’s ability to be an ongoing business. Since the company was not public, no independent year­end audit was done. In late February, 2015 Temple discovered that over $175,685 in accrued expenses had not been recorded at year end. Had these liabilities been recorded the company’s $99,725 profit would have really been a $22,185 loss. Temple approached Lisa with this information and told her the year­end financial statements needed to be corrected. Lisa was adamant that this could not be done under any circumstances. Her reasoning was that new customers were being acquired on a daily basis and sales for the current fiscal year would be substantially higher than last year. Therefore, the current year would be able to absorb the accrued liabilities not recognized in the previous year and still show a nice profit. She feared that if the financial statements were restated the investors, who were not all that savvy when it came to understanding financial statements, would panic at the loss and shut the business down, putting both Lisa and Richard out of work. What should Richard Temple do? Read more kenkenken
posted a question · Sep 21, 2015 a…

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