Merchandise after the end of the fiscal year


The president of Kuai Company stopped by your office today for a chat. She began by assuring you that, as the controller for Kuai, you have the final say in matters concerning the accounting records. However, she also indicated that unless sales revenue increased by $350,000 before the end of next week, the fiscal year-end of the company, the bank would call in the company's loan, and Kuai might have to declare bankruptcy. She has asked you to review the current orders in house to determine if this goal will be met. After performing your analysis, you note that sales revenue should increase $250,000 by the end of next week. You contact the president, who says that's not good enough. She then tells you to ship $100,000 of merchandise to Maui Company and record the sale on the last day of the fiscal year. You know that Maui Company is owned by a close personal friend of the president and that the company will just return the merchandise after the end of the fiscal year. If you were the controller for Kuai Company, what would you do and how would you attempt to resolve this issue?

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Accounting Basics: Merchandise after the end of the fiscal year
Reference No:- TGS057934

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