Reimbursed for costs on the canadian government job


Andre Preneur supervises two consulting jobs in the consulting firm of Dewey, Cheatham, and Howe, which does studies on environmental cleanup. One of the consulting jobs is for the Canadian government the other is for General Electric, Inc. After receiving the monthly financial reports on the two jobs, he immediately called his boss to report that costs were way over budget on the General Electric job. %u2018%u2018The job is only about three-fourths complete, but we%u2019ve spent all the money that we had budgeted for the entire job,%u2019%u2019 he said. %u2018%u2018You%u2019d better watch these job costs more carefully in the future,%u2019%u2019 his boss advised. %u2018%u2018Meanwhile, charge the rest of the costs needed to complete the General Electric job to your Canadian government job. We%u2019re under budget on that job, plus we get reimbursed for costs on the government job.%u2019%u2019

a. What should Andre do?
b. Does it matter that Andre%u2019s consulting firm is reimbursed for costs on the Canadian government job? Explain.

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Accounting Basics: Reimbursed for costs on the canadian government job
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