35 Minutes, Medium
a.
SOLUTIONS TO CRITICAL THINKING CASE
S
SELECTING AN INVENTORY SYSTEM
CASE 6.1
The Frontier Shop would probably use a periodic inventory system. Several factors
support this conclusion. First, this is a small business that does not have a computerized
e.
f.
CASE 6.1
Several factors suggest that TransComm would use a perpetual inventory system. For one,
management needs to know precisely how many units are on hand at any time in order to
know whether the company can fill the large sales orders it receives from customers. Next, the
(concluded)
An ice cream truck would use a periodic inventory system. Several factors support this
conclusion. First, it would be impractical for an ice cream truck to utilize a perpetual system,
as this would involve separately recording the cost of each ice cream bar and popsicle sold.
SELECTING AN INVENTORY SYSTEM
Group assignment:
No time estimate
No specific solution is provided for this group assignment.
The textbook will discuss some of these variations in Chapter 8. At this point, however, we
consider it useful for students to learn first-hand that accounting systems are tailored to meet
the specific needs of the organization.
CASE 6.3
GROUP ASSIGNMENT WITH
BUSINESS COMMUNITY
INVOLVEMENT
20 Minutes, Medium
a.
CASE 6.
4
MANIPULATING INCOM
E
Your first thought should probably be whether you want to work for someone who asks you
to do something that is wrong in order to benefit himself. You should probably start by
ETHICS, FRAUD & CORPORATE GOVERNANCE
supervisor’s superior. Even if this means losing your job, you cannot afford to compromise
your own reputation, or put yourself at risk of criminal charges, to help another person who
is trying to artificially improve his own financial wellbeing. The behavior your supervisor
exhibits will, at best, result only in short-tem gains and will ultimately be his downfall. You
cannot afford to go down with him. If Albers, Inc. is a public company, it will be required to
25 Minutes, Easy
CASE 6.5
INTERNET
Note: We cannot supply quantitative answers to this assignment as they are time sensitive. Our
EXPLORING THE ANNUAL REPORT OF GAP, INC.