AC499 Unit 8 Seminar Draft Review Example

Six Questions, Three Without Answers: A Unit 8 Capstone Seminar Review of a Draft Integrated Report

[Student Name]

Purdue University Global

AC499: Bachelor's Capstone in Accounting

Unit 8 Seminar Draft Review

[Instructor Name]

[Date]

Kettle Hollow Sauna Works, the classmates and every figure are composite; the textbooks cited are real.

Question Log

Row 1. Asked by Dana: Which pretax income is the real one? The executive summary quoted $1,362,000 from the case trial balance, while the restated statements show $1,171,240. The draft could not answer, because the summary had been written before Unit 3. Fix: the summary now uses $1,171,240 and states the five corrections in one sentence. Units touched: 3 and 9.

Row 2. Asked by the instructor: Why does the balance sheet show a deferred tax liability of $32,760? The draft carried the panel saw's liability gross, while the Unit 5 brief nets it against the $20,475 warranty asset to a single noncurrent liability of $12,285, as current standards require for one jurisdiction (Financial Accounting Standards Board, 2015). The draft could not answer. Fix: the balance sheet now shows $12,285, and total liabilities fall by $20,475. Units touched: 5 and 9.

Row 3. Asked by Luis: Which labor rate does the costing section use? The costing section used $120 of milling labor a set from the cost card, while the control section found that rate overstated by about $6.37 because of unsupported temp pay. The draft used both without reconciling them. Fix: the costing section now shows the decision at both rates. Units touched: 4, 6 and 9.

Row 4. Asked by Priya: Why not elect LIFO if prices are rising? The draft answered from the tax section: the conformity rule would cut reported income by $96,400 and narrow the covenant margin. No fix needed.

Row 5. Asked by Marcus: How low can peak volume go before the second line loses money? The draft answered from the costing section: 654 extra sets at the original rate. No fix needed, though the figure changed after Row 3.

Row 6. Asked by the instructor: Does the board know who owns the outside mill? The draft described the ethics decision but did not recommend a policy. Fix: a paragraph now recommends a board policy requiring officers to disclose family interests in suppliers. Units touched: 7 and 9.

Three of six questions found no answer because each figure had been computed correctly in its own unit and then copied into the draft from an older version, which shows that a capstone's errors live in the seams between units rather than inside them.

What the Fixes Changed

At the corrected labor rate, milling in-house saves $89,093 a year before tax instead of $84,000. Counting the tax saving from expensing the line and taxing the annual savings at 21 percent, the after-tax net present value rises from $125,676 to $151,499, and break-even volume falls from 654 to about 631 sets. The recommendation stays the same and becomes stronger. Net income of $923,012 does not change, because the restatement had already been booked; only the summary had been wrong. The balance sheet now balances against the tax brief.

What Stayed the Same

The second-line recommendation, the payroll remediation date of July 15, 2027, and the LIFO decision all held. The ethics section was extended, not changed.

Process Change for the Final Report

Every figure that appears in more than one section will be listed in an agreement table with the unit where it was first computed, and the final draft will be checked row by row against that table before it is submitted. Reconciling figures across schedules is the same discipline the statement rebuild required (Kieso et al., 2019), and relevant-cost figures must be updated whenever an input changes (Datar & Rajan, 2021).

References

Datar, S. M., & Rajan, M. V. (2021). Horngren's cost accounting: A managerial emphasis (17th ed.). Pearson.

Financial Accounting Standards Board. (2015). Income taxes (Topic 740): Balance sheet classification of deferred taxes (Accounting Standards Update No. 2015-17). FASB.

Kieso, D. E., Weygandt, J. J., & Warfield, T. D. (2019). Intermediate accounting (17th ed.). Wiley.