Raffie's Kids, a nonprofit organization that provides aid to victims of domestic violence,...

Question

Raffie's Kids, a nonprofit organization that provides aid to victims of domestic violence, low-income families, and special-needs children, has a 30-year, 5% mortgage on the existing building. The mortgage requires monthly payments of $3,000. Raffie's bookkeeper is preparing financial statements for the board and, in doing so, lists the mortgage balance of $287,000 under current liabilities because the board hopes to be able to pay the mortgage off in full next year. Of the mortgage principal, $20,000 will be paid next year if Raffie's pays according to the mortgage agreement. The board members call you, their trusted CPA, to advise the on how Raffie's Kids should report the mortgage on its balance sheet. What is the ethical issue? Provide your recommendation and discuss the reason for your recommendation.

Instructions:Your initial response should be no less than 250 words.

David · Accepted Answer

Running Head:  Analysis of Ethical Issue
Student Name:
Professor Name:
College Name:
Raffie’s Kids have to be aware of all the financial reporting requirements based on its financial statement users for example, internal such as the management and the board of directors and external user who may include the funding agencies, to the contributors, to the Internal Reserve Service and the government. 
Raffie’s Kids should treat and report its current mortgage balance amounting $287,000 as its principle mortgage.

Raffie's Kids, a nonprofit organization that provides aid to victims of domestic violence, low-income families, and special-needs children, has a 30-year, 5% mortgage on the existing building. The...

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment