On January 20, 2011, Tamira Nelson, the accountant for Picton Enterprises, is fe

Question

On January 20, 2011, Tamira Nelson, the accountant for Picton Enterprises, is feeling pressure to complete the annual financial statements. The company president has said he needs up-to-date financial statements to share with the bank on January 21 at a dinner meeting that has been called to discuss Picton%u2019s obtaining loan financing for a special building project. Tamira knows that she will not be able to gather all the needed information in the next 24 hours to prepare the entire set of adjusting entries. Those entries must be posted before the financial statements accurately portray the company%u2019s performance and financial position for the fiscal period ended December 31, 2010. Tamira ultimately decides to estimate several expense accruals at the last minute. When deciding on estimates for the expenses, she uses low estimates because she does not want to make the financial statements look worse than they are. Tamira finishes the financial statements before the deadline and gives them to the president without mentioning that several account balances are estimates that she provided.

Required

donot copy from others please=)

Explanation / Answer

1. The entries which she estimated in the last 24 hours should be written under the column of estimates in financials, then it will be better to understand the situation. While estimating entries, she should use high estimates even the financials look worse as if actual is less than estimates, financials will look better, financials will have worst effect if actual greater than estimates.

2. i will estimate most important entries with precision, categorise the estimated entries to get most appropriate results such as of net income etc and i will follow the above mentioned recommendations

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