Question.

Case study:

I need new answers for comparison.

Creative accounting in the economic business between concept and application

Creative accounting consists of accounting practices that follow required laws and regulations, but deviate from what those standards intend to accomplish. Creative accounting capitalizes on loopholes in the accounting standards to falsely portray a better image of the company. Although creative accounting practices are legal, the loopholes they exploit are often reformed to prevent such behaviors.

Creative accounting capitalizes on loopholes in the accounting standards to falsely portray a better image of the company. Tweaking figures can lead to higher bonuses for directors, help convince a lender to give a firm a loan and inflate the company's valuation. Creative accounting tricks vary in nature and consistently evolve as regulations change. Investors should always be skeptical and read financial statements from top to bottom for any signs of foul play.

Business economics is a field of applied economics that studies the financial, organizational, market-related, and environmental issues faced by corporations. Business economics assesses certain factors impacting corporations?business organization, management, expansion, and strategy?using economic theory and quantitative methods. Research topics in the field of business economics might include how and why corporations expand, the impact of entrepreneurs, interactions among corporations, and the role of governments in regulation.

Business economics is a field of applied economics that studies the financial, organizational, market-related, and environmental issues faced by corporations. Business economics encompasses subjects such as the concept of scarcity, product factors, distribution, and consumption. Managerial economics is one important offshoot of business economics. The National Association for Business Economics (NABE) is the professional association for business economists in the U.S.

Variables

Overestimating revenues: One of the most common techniques used by public companies looking to artificially boost their income is to prematurely recognize revenue. Revenue recognition is an accounting method that enables companies to recognize sales before they deliver a product or perform a service. It is open to exploitation.

Lowering depreciation charges: Companies often spread out the cost of assets, rather than expensing them in one hit. Methods to reduce annual charges on these items can include extending the useful life estimate of the asset or increasing its assumed salvage value.

Delaying expenses: Deferring the recording of current period expenses, such as payments to suppliers and rent, to a subsequent period makes current period earnings look better.

Masking contingent liabilities: Failure to record potential liabilities that are likely to occur and underestimating how much they are likely to cost can boost net income or shareholders' equity.

Undervaluing pension liabilities: Pension obligations can easily be manipulated because the liabilities occur in the future and company-generated estimates need to be used to account for them.

Inventory manipulation: Inventory represents the value of goods that were manufactured but not yet sold. Overstating the value of inventory will lead to an understatement of cost of goods sold, and therefore an artificially higher net income, assuming actual inventory and sales levels remain constant.

Managerial Economics: Managerial economics is a field of study within business economics that focuses on the microeconomic factors that influence the decision-making processes with an organization. The strategic decisions of corporations result in either a profit or a loss for the company. Managerial economic principles are intended to influence and guide corporate strategy and decisions toward the best outcomes for a company. The study of managerial economics is applied to both the public and private sectors, as well as to for-profit and not-for-profit organizations. All of these types of organizations must effectively assess the economic climate in order to remain solvent (because all organizations require a source of funding to continue operations). Across all sectors of the business world, the main goal of managerial economics is to use all available resources within an organization, specifically maximizing production while at the same time minimizing any waste.

Business Economics for Nonprofit Organizations: While nonprofit organizations and for-profit organizations may have different goals, both of these types of organizations perform similar business functions and require similar expertise. In addition, they must also strive to limit waste and maximize the overall usefulness of their available resources in order to maintain their viability as enterprises. Both nonprofit organizations and for-profit organizations have to maintain the necessary capital to continue working within the economy; this requires them to use many of the same principles. For example, all types of organizations engage in advertising, community, or customer support and need leadership to make appropriate strategic decisions.

Conceptual model for these relationships.

A conceptual framework can be defined as a system of ideas and objectives that lead to the creation of creative accounting to differentiate between earnings management and fraud, for which literature review has been thoroughly analyzed. Model has been developed, which demonstrates the parties i.e. Banks, Auditors, Investors, Regulatory authorities etc. that are involved in creative accounting. Accounting professionals take advantage of the loopholes in the accounting regulations to manipulate accounts. Creative accounting can be done either "Beyond the Regulatory requirements" or "Within the Regulatory requirements". This study suggests that Manipulations can be controlled by the effective implementation of Corporates' internal control systems, compliance with codes of corporate governance and meeting the financial reporting regulatory requirements. in economics, a model is a theoretical construct representing economic processes by a set of variables and a set of logical and/or quantitative relationships between them. The economic model is a simplified, often mathematical, framework designed to illustrate complex processes. Frequently, economic models posit structural parameters. A model may have various exogenous variables, and those variables may change to create various responses by economic variables. Methodological uses of models include investigation, theorizing, and fitting theories to the world.

Hypotheses for those relationships

Analysts, asset managers, and financial journalists failed to see many of the above scandals coming, proving that it is not always easy to spot questionable accounting practices. However, that does not mean that investors should sit back and do nothing. Being skeptical and reading financial statements a little more closely, rather than just focusing on what management highlight, can go a long way to detecting suspicious activity. A good starting point is to carefully read company footnotes, assess the reliability of auditors and pay careful attention to any unusual variations in figures. in the broadest sense, economics refers to the study of the components and functions of a particular marketplace or economy?such as supply and demand?and the impact of the concept of scarcity. Within economics, production factors, distribution methods, and consumption are important subjects of study. Business economics focuses on the elements and factors within business operations and how they relate to the economy as a whole. The field of business economics addresses economic principles, strategies, standard business practices, the acquisition of necessary capital, profit generation, the efficiency of production, and overall management strategy. Business economics also includes the study of external economic factors and their influence on business decisions such as a change in industry regulation or a sudden price shift in raw materials.

Required: Based on the above, summarize the information as follows

In the research proposal, an introduction to the research idea is started and then the conceptual framework that clarifies a theory that can be relied upon (if possible) within the framework of the proposed study, the study variables and the relationships between them, and the formulation of appropriate hypotheses for those relationships.

After the conceptual framework, we will talk about the study methodology, which follows the scientific method and based on the positive philosophy, and after the introduction on the study methodology, the statistical procedures that will be implemented must be clarified, such as descriptive and inferential statistics, and how to test the hypotheses of the study.

We must talk about the role of statistical Stata app in implementing various statistics.

At the end of the research proposal, a discussion is made about the estimated time of study, and here it is preferable to assume that this study represents your graduation project and thus the time period available to it, and it is necessary to talk about any ethical considerations that may be necessary in the course of the study, especially when the study intersects the collection of data from People or about people.

Two.

?

Question 1: Louis the retired Canadian lives on a fixed budget and consumes only two goods: toques (T) and maple syrup (M). Suppose Louis' monthly budget is 100 and the price of the two goods are (PT, PM) = (4,2). (a) Make a properly labeled diagram illustrating Louis' budget constraint with T on the hori- zontal axis and M on the vertical axis. Indicate the area corresponding to the set of bundles (M, T) that Louis can afford (b) What is the maximum T that Louis can afford? What about the maximum M? (c) What is the slope of the budget line, and what is the economic interpretation of it? (d) Suppose the Canadian government decides to ration maple syrup, limiting each person to a maximum of 40 units of maple syrup per month. Draw a new diagram showing Louis' new budget constraint and indicate the area corresponding to the set of bundles that Louis can afford now. Question 2: Annie and Marty are both single parents with full-time jobs. Consequently, both value child care services (5) and children's clothing (C) but may have different preferences for the two goods. The government decides it wants to make life easier for single parents and is considering providing single parents with monthly child care vouchers or, simply, providing single parents with a cash payment every month. Suppose Annie and Marty's incomes are both 400, the price per unit of child care is 10 per unit and the price per unit of clothing is 20. (a) Draw Annie's budget constraint assuming the government decides to offer a $100 voucher for child care. (b) Draw Marty's budget constraint assuming the government decides to offer a $100 cash payment to single parents. (c) Draw an indifference curve representing Annie's preferences that is consistent with Annie strictly preferring the cash payment to the voucher. (d) Draw an indifference curve representing Marty's preferences that is consistent with Marty being indifferent between the cash payment and the voucher. Question 3: After winning the lottery, Australian Artie decides to retire, stay home, and watch sports on television all day. Artie likes both Rugby, R, and Aussie Rules Football, F and views them as imperfect substitutes. In particular, Artie's preferences can be represented by the follow- ing utility function: U = R04Foe. Since Artie is rich, the only cost of watching F is the opportunity cost of not watching R: one hour of R necessarily means one hour less of F. In other words, even though Artie is rich, there is still a price on his time. 1-2 of 2(a) What is Artie's marginal rate of substitution between R and F, MRSay? Interpret it. (b) What is the price ratio, PR/PF? Interpret it. (c) Suppose Artie chooses some bundle, (R, F). If this bundle maximizes Artie's utility, what relationship must hold between R and F? (d) Define ME. What is the interpretation of this? If Artie is maximizing his utility, what must FR MUs be equal to? (e) Suppose there are 24 hours in a day. What bundle (R, F) will Artie consume? [Now you should find actual numbers.] Question 4: Picky Pete drags Indifferent lan out for coffee at an upscale Italian cafe which sells only espresso (E) and biscotti (B). Picky Pete simply must have one biscotti for every espresso consumed, whereas Indifferent lan views espresso and biscotti as perfect substitutes. One of their utility functions is given by U = min [E, B] and the other's by U = E + B. (a) Given the description, which utility function corresponds to which person? (b) Suppose the prices of the goods are (PEPs) = (2,1) and Pete has allocated $12 for the outing while lan brought only $4. Solve for each person's utility-maximizing bundle of espresso and biscotti. (c) Draw a fully labeled diagram illustrating Pete's budget constraint, his optimal bundle, and an indifference curve representative of his utility at his optimal bundle. Indicate how much utility Pete obtains. (d) Do the same for Ian. Question 5: Energetic Erin consumes a worrisome amount of caffeinated beverages, particularly soda (S) and coffee (C). A utility function representing her preferences is given by U = 450503. Erin's Income is 120 and the prices of the two drinks are given by (ps. pc) = (4,2). (a) Solve for Erin's utility maximizing bundle of beverages and calculate how much utility she obtains from it. (b) Suppose Erin moves to Berkeley where there is a soda tax and, consequently, the price of soda is 6. Solve for Erin's new utility maximizing bundle of beverages and calculate how much utility she obtains now. What is the "total effect" of the price change on Erin's consumption of soda? (c) Draw a diagram showing Erin's budget constraint before and after the move, and repre- sentative indifference curves of her choices before and after the move. (d) The total effect you found in part "b" can be broken down into a "substitution effect" and an "income effect". What is the sign of: (i) the total effect, (ii) the substitution effect, and (iii) the income effect? Explain why for (ii) and (uil). 1-2 of 2