ACC 211 Week 1 Discussion 1

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ACC 211 Week 1 Discussion 1

M1D1: Let’s Discuss: Fraud

Roy Akins was the accounting manager at Zelco, a tire manufacturer, and he played golf with Hugh Stallings, the CEO, who was something of a celebrity in the community. The CEO stood to earn a substantial bonus if Zelco increased net income by year-end. Roy was eager to get into Hugh’s elite social circle; he boasted to Hugh that he knew some accounting tricks that could increase company income by simply revising a few journal entries for rental payments on storage units. At the end of the year, Roy changed the debits from “rent expense” to “prepaid rent” on several entries. Later, Hugh got his bonus, and the deviations were never discovered.

For this week’s discussion, please respond to the questions listed below. In addition to your initial response, for full credit, please be sure to respond to more than two other students’ initial responses, as well.

Required Responses:

1.      How did the change in the journal entries affect the net income of the company at year-end?

2.      Who gained and who lost as a result of these actions?

This discussion will address the following Module Outcomes:

·         MO1: Apply the fundamental concepts and principles in accounting.(CO1)

·         MO2: Apply the primary financial accounting equation and its components. (CO1)

·         MO3: Apply the rules of debit and credit. (CO1)

Consult the Discussion Posting Guide for information about writing your discussion posts. It is recommended that you write your post in a document first. Check your work and correct any spelling or grammatical errors. When you are ready to make your initial post, click on "Reply." Then copy/paste the text into the message field, and click "Post Reply." 

To respond to a peer, click “Reply” beneath her or his post and continue as with an initial post.

Evaluation

This discussion will be graded using the discussion board rubric. Please review this rubric, located on the Rubrics page within the Start Here module of the course, prior to beginning your work to ensure your participation meets the criteria in place for this discussion. All discussions combined are worth 20% of your final course grade.