FINANCIAL ACCOUNTING CASE WORK 2
Financial Accounting Case Work
Case 1: Susan Casey’s Case
1. Disclosure
From the case, Susan should provide the bank with the new balance sheet based on the
updated information. One of the key disclosures in financial reporting is the balance sheet. It
ensures that the organization discloses its financial position to stakeholders. It is the role of the
accountant like Susan to ensure that the balance sheet presents the right financial position and
information. It is evident that the organization is performing well. As such, Susan would not
have accepted the initial findings. Her presentation of findings was not objective since all the
information regarding the performance and position of the firm had not been satisfied.
2. Allowance Method
Susan did not properly use the allowance method. The allowance method facilitates the
clearance of uncollectible accounts. Bad debts are recorded on the year that the sale is made and
is used in adjusting the accounts receivables n the balance sheet. The method is largely restricted
to the assessment of income tax. The allowance method provides a projection of bad debt
expenses within the organization (Warren, & Jones, 2019). Effective analysis of the uncollectible
debt and the provisions for the uncollectible accounts ensures that the debt that is recorded as bad
has limited chances of being collected within the organization. This enhances the accuracy in
financial reporting.
3. Accounting Disclosure
Organizations report information regarding financial performance and position. This
enables them to have access to adequate resources in these operations. Susan should make
