Wallace Inc.

To: Peter and Samantha W wholeace From: Accounting advisor Re: Accounting policies Before recommending all(prenominal) accounting policies to be implemented, in that respect argon more or less be assumption and gravestone stakeholders that you mustiness recognize. The likely vendee is currently your most alpha stakeholder, as he is fire in purchasing all your shares. He needs to steady refine whether spend in Wallace would be profitable through analyzing the social clubs monetary statements. Additionally, since Wallace is altogether owned by the both of you, I assume you would indigence the highest purchase price. In this way, income maximization is your monetary statement impersonal as it impart too pull in to the potential buyer. An distinguished upshot hither is that the buyer is requesting GAAP-based pecuniary statements. The jump issue that should be taken into consideration is Wallaces customer case. The comp either has three epoch-making customers who account for 80% of pith revenues ($15M). This may cause problems either time in the in store(predicate) if the company were to lose any of these accounts. A dismission of alone one customer will have a ample negative impact on Wallaces profitability. This issue could be disclosed in the nones to the financial statements, so prospective buyers are aware of this.

It would be important to remark that Wallace should concenter on diversifying its customer base. This way, it may buy the farm to a to a great extent financially expectant company, with a better money prediction. The succeeding(prenominal) issue pertains to the $50,000 worth of stock-taking that has been sitting in a factory for over a year and currently not being manufactured. If this stemma has pay back obsolete, it should be written pass away into and not included as an asset in the financial statements. On the other hand, if this inventory is going to be used, at that place should be a note of this and most importantly, the inventory must be written down to its net realizable value. Because of the forever and a day changing environment of the railway car industry, inventory that has not...If you want to retire a full essay, line of battle it on our website: Ordercustompaper.com

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