[bupson]

Annette opened Real Estate Co. on January 1, 2010. At the end of the first year, the business needed additional capital. On behalf of Real Estate, Annette applied to Lake County State Bank for a loan of $200,000. Based on Real Estate’s financial statements, which had been prepared on a cash basis, the lake County State Bank loan officer rejected the loan as too risky.
After receiving the rejection notice, Annette instructed her accountant to prepare the financial statements on an accrual basis. These statements included $31,500 in accounts receivable and $10,200 in accounts payable. Annette then instructed her accountant to record an additional $10,000 of accounts receivable for commissions on property for which a contract had been signed on December 28, 2010, but which would not be formally “closed” and the title transferred until January 2011.
Annette then applied for a $200,000 loan from First National Bank, using the revised financial statements. On the application, Annette indicated that she had not previously been rejected for credit.
Discuss the ethical and professional conduct of Annette in applying for the loan from First National Bank.

[odinn7]

You discuss it. We are not allowed to do homework here. Aside from that, do you think anyone here....we are all volunteers...is going to actually sit here and write this all out for you so that you don't have to do it yourself?

[smoothy]

I agree... if you can't do the homework assignment... you don't deserve to pass the class.

SHow us what you did for the answer and we will offer advice.

[pready]

Think about the False statement made by Annette made on the Loan application and how it will affect her and the loan company.