Question - 1

Identify the working capital accounts related to:

1. revenues recognized and deferred,
2. cost of goods sold,
3. employee salary and wages, and
4. income tax expense.

For each account, indicate whether an increase in the working capital asset or liability would be an addition or subtraction when reconciling from net income to cash flows from operations. How would a company alter these accounts for earning manipulation? How does this possible manipulation impact the financial statements?

Question - 2

Comparing the Neoclassical and Behavioral Views. Do you find the behavioral view of consumer protection more persuasive than the neoclassical view? Why did the regulatory models based on neoclassical economics persist for so long?

Question - 3

A Supernanny Agency? David Evans and Joshua Wright argued that the proposed Consumer Financial Protection Agency would "form a 'supernanny agency'...designed to substitute the choice of bureaucrats for those of consumers." Do you agree? Should the CFPB focus on disclosure or substantive protections? What is the right balance