Required: It is now March 30, 2021. Prepare the report for Shannon and provide any other recommendations relevant to the bank loan. Perform an analysis using the Issue \& Analysis Framework: - Identify TWO users and state clearly their objectives - Identify THREE accounting issues/policies pertaining to the case - Identify any definitions, criteria and constraints that will help you argue your position - For each accounting issue, identify TWO alternative choices - Analyze each choice and their implications to the users and their objectives - Provide a recommendation for each issue with rationale *Be careful to stay within the confines of the case data when identifying the options and recommendations! Hints to help with your analysis: - Recalculate the ratios to determine the effects on the bank covenants. - Recalculate the aged A/R based on any changes you may have made - Be careful to stay within the confines of the case data when identifying the options and recommendations! Excel Requirement: - Using the Excel spreadsheet provided, recalculate the balances in the accounts and determine whether the working capital loan is in violation. Provide any recommendations to Anam Cara based on your findings. Identify 3 or 4 issues and give 3 alternatives for each issues. Among the three alternatives recommend a best alternative. Give reasons for why we chose this alternative and did nit select the other 2. Example: Issue 1: Alternative 1 for issue 1 Alternative 2 for issue 1 Alternative 3 for issue 1 The best alternative among this would be. we did not choose the other alternatives because Issue 2: Alternative 1 for issue 2 Alternative 2 for issue 2 Alternative 3 for issue 2 The best alternative among this would be...... we did not choose the other alternatives because And so on for all the 4 issues that we identify with this case study Any one issue should be about revenue recognition Other issue about bad debts and another one with Nurse now Check if the alternatives suggested for issues are in accordance with GAAP accounting principle, does it have an effect on the users objective (if yes and no why) and if it has effects on financial statemets (How) 3. The aged accounts receivable balance is as follows: ACFC reached an agreement with a local nurses company to provide 55 pairs of yoga pants and shirts for an upcoming walk-a-thon in May, 2021. The shirt and pants were customized with an embroidery of each nurse's name. ACFC charged Nurse's Now a special promotion price of $75 per combo and delivered the goods mid-March. In late March, Nurse's Now contacted ACFC stating that the goods received are not the same as the goods ordered. Nurse's Now has asked for a 40% discount on the goods, or else it plans to return goods and cancel the order. Receivables 7 to 10 are a result of a promotion held by ACFC in order to attract more corporate clients. Based on her experience, Shannon states that 10% of receivables past 60 days are typically uncollectable; however, she is very confident that the receivables from Elgood \& Irving will be collected. Even though a violation of the covenant can result in the credit facility becoming cancelled with the outstanding balance due immediately, Shannon states that she is not too concerned because her accounts receivable and inventory are $34,320 and $96,550 respectively, while her loan is only $65,000. However, she would like you to prepare a report to go along with the review engagement, which discusses the appropriate accounting treatment of the above noted accounting issues. Anam Cara Fitness Centre Anam Cara Fitness Centre (ACFC) is a newly established business that offers Pilates classes and Pilates/yoga clothing and accessories. ACFC operates out of Sidney, British Columbia, and is owned by Shannon Parsons, a Pilates and yoga teacher. Shannon decided to start her own Pilates and Yoga studio in order to provide a larger variety of customized classes to small groups, including beginner, intermediate and advanced classes. ACFC also has a small storefront that is used to sell fitness clothing along with other accessories, such as headbands, water bottles and yoga mats. In order to help finance operations, ACFC obtained a working capital loan from the small business department of a local credit union. The loan is a revolving line of credit that is secured by the company's inventory and accounts receivable. The loan is not to exceed a maximum of 50% of inventory and 75% accounts receivable as at the company's year-end (March 31, 2021). ACFC must present reviewed financial statements prepared in according with ASPE, to the credit union within 60 days of its year end. It is now February, 2021, and Shannon is starting to get nervous about the preparation of the financial statements. Shannon has minimal exposure to accounting duties; therefore, she hired a local bookkeeper to help her select an appropriate fiscal year end, set up an accounting software package, and design processes and documents to be used in day-to-day functions. Shannon has contacted Braun \& Frost LLC in regards to conducting a review of ACFC's financial statements. You are the senior accountant in charge of the review, and recently sat down with Shannon to discuss the engagement. Shannon feels confident that all of her routine transactions have been posted correctly, but is unsure of some of the more complicated issues that arose during the year. Shannon discusses with you the following unresolved issues: 1. ACFC was able to obtain a large corporate client, Elgood \& Irving, Barristers and Solicitors, LUP. On July 114,2020, ACFC and the law firm agreed that the employees of the firm would have unlimited access to the yoga classes for a yearly fee of $50,000, with 50% payable upfront. The fee is nonrefundable, non-cancellable, and not dependent on the number of classes actually participated in by the law firm employees. Shannon credited revenue for $50,000 when the contract was signed and debited both cash and accounts receivable for $25,000 each. This large contract helped with cash flows, and is a major reason why ACFC has a current cash balance of $10,000. 2. Mid-way through the year, ACFC began selling energy bars and drinks in its storefront. ACFC reached an exclusive agreement to be the sole distributor of Excel Energy Plus bars in Saskatoon. ASCFC was required to purchase 5,000 bars at the onset of the contract, at a cost of $2.50 per bar. On March 15, an ingredient included in the bars was allegedly linked to various illnesses. Currently, the Food and Drug Administration in the US is investigating the allegations, and the outcome is uncertain. Canadian officials have not yet commented on the situation. ACFC sold 1,340 bars during the year