PLEASE RESPOND USING THE FASB CODE TO HELP BACK UP YOUR ANSWERS. You are the chief financial officer for a mid-sized, manufacturing company. You often advise management on accounting and financial matters because they have very little background in these areas. You are trusted and have a reputation for doing your homework before responding to executives questions. You have found that this approach is successful both in responding accurately and confidently to management and in instructing your staff on the proper accounting treatment for and reporting of various business transactions. Respond to management for the scenarios below. Be sure to reflect your homework using the Accounting Standards Codification and business acumen and reflect these in your response. Submit your work on Schoology by the due date. Your company has recently closed a $10 million loan with a bank to fund construction of a new factory building next to the old one. The CEO just returned from lunch with Joe, the CEO of a competitor. Your CEO enters your office and says: Joe just told me that his financial guys report interest payments on debt in the investing section of the statement of cash flows. That sounds pretty good to me. Let me know if we can do that too. As you know, free cash flow is a key statistic assessed by investors and creditors. The CEO has been working with CEO Joe, from a competing company, on a joint venture to develop a new product that both companies will manufacture when the joint venture is dissolved. The structure of the joint venture is 50/50 ownership of the JVs stock and 50/50 profit/loss sharing. It is intended to be a collaboration of equals. The CEO says, Now for my main question. He continues, Joe thinks we should reflect the JV on each of our books using a simple cost approach, since we each have the same amount of influence on the JV. I am not as knowledgeable about this stuff as he is, but I like his approach. Its easy to understand. Its like one of our subsidiaries that we account for at cost on the interim basis before it gets consolidated at year end. Okay, I know that you like to think things over before your respond. Ill stop by tomorrow before lunch for your answer. I have lunch with Joe again tomorrow.