Pdot Company is a pesticide manufacturer. Its sales declined greatly this year due to the passage of legislation outlawing the sale of several of Pdot chemical pesticides. In the coming year, Pdot will have environmentally safe and competitive chemicals to replace these discontinued products. Sales in the next year are expected to greatly exceed any prior years. The decline in sales and profits appears to be a one-year aberration. Even so, the company president fears a large dip in the current years profits. He believes that such a dip could cause a significant drop in the market price of Pdots stock and make the company a takeover target.

To avoid this possibility, the company president calls in Mary, controller, to discuss this periods year-end adjusting entries. He urges her to accrue every possible revenue and to defer as many expenses as possible. He says to Mary, We need the revenues this year, and next year can easily absorb expenses deferred from this year. We cant let our stock price be hammered down! Mary didnt get around to recording the adjusting entries until January 17, but she dated the entries December 31 as if they were recorded then. Mary also made every effort to comply with the presidents request.

1. What is a clear and concise thesis statement based upon the information above and accounting Standards and ethical principals.