Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question is, is this activity a fraudulent one, ie stuffing the channel to pull in sales. You all know the answer. It depends, there is

Question is, is this activity a fraudulent one, ie stuffing the channel to pull in sales. You all know the answer. It depends, there is nothing necessarily wrong about pulling in a sale, if there is a good business reason, and offering sales prices to do so is acceptable. But, if it is material and will create unnatural deficit in sales in the next quarter, as the customer will obviously not need more goods, it would be a problem if not disclosed. So it may nor may not be a problem from an accounting point of view. From a business point of view, how do you view this. As a shareholder, would you be very happy with the actions of management. Could they have done this to get a bonus they did not deserve. Potentially cause a fraud. What about the loss of profit on the sale. Believe it or not, this behavior is not that uncommon. What do you think of the business practice.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Modern Auditing

Authors: Walter Gerry Kell, William C. Boynton, Richard E. Ziegler

5th Edition

0471542830, 9780471542834

More Books

Students also viewed these Accounting questions

Question

3. Contrast relational contexts in organizations

Answered: 1 week ago

Question

2. Describe ways in which organizational culture is communicated

Answered: 1 week ago

Question

1. Describe and compare approaches to managing an organization

Answered: 1 week ago