It is February 16, 2020, and you are auditing Jack Corporations financial statements for 2019 (which will be issued in March 2020). On February 15, 2020, you read in the newspaper that Davis, Inc., a major customer of Jack, currently is in financial difficulty. Included in Jacks accounts receivable is $50,000 (a material amount) owed to it by Tritt. You approach jack, president of Jack Corporation (your client), with this information and suggest that a reduction of accounts receivable and recognition of a loss on doubtful accounts for 2019 might be appropriate. Jack replies, Why should we make an adjustment? True, the president of True, Inc., is a friend of mine; she will find a way to pay us, one way or another. Furthermore, this occurred in 2020, so lets wait and see what happens; we can always make an adjustment later this year. Required: In your position as the external auditor of Jack Corporation, prepare a memo to Ms. Davis, the audit intern on the engagement, and address the following: 1. The ethical issues faced by yourself and the client. 2. Identify the major stakeholders involved and state how the stakeholders would be affected by the course of action suggested by Jack . 3. State the different accounting treatments that could apply to this situation. 4. Explain your suggested course of action. 5. Explain the proper accounting treatment and support your answer with appropriate authoritative citation. Note: Ms. Davis is an intern, not an experienced auditor; therefore, the items in the memo should be explained in a manner that a novice can understand.