Accounting Case Problem | Quick Homework Help

  1. Identify the issue/s
  2. Collect the Evidence
  3. Analyze and evaluate alternatives
  4. Develop Conclusion


  1. Communicate results and document


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Case problems:

 Mount Pleasant Epilepsy Association is a not-for-profit agency. Joseph Howard is the Chair of its Voluntary Board of Directors. He is also the owner of Howard Insurance Company. The Association rents its facilities from Howard Insurance Company. The Company charges the Association $10 per square foot of space per month. This amount is considerably below the City’s average “market” rate of $14 for similar office space. The rental rates have not changed during the five years that the Association has occupied its present location. However, no formal agreement for this rental situation exists. Joseph has “hinted” that “one day” the Company may ask the Association to significantly increase its rental payments or move to another location. What disclosures, if any, should the Association make regarding this situation?



The Oakland County Hospital performs lots of work for Medicare and Medicaid patients. This results in both reimbursement of certain operating costs and some profit.  “Transfers” among related subsidiaries within the Hospital also contain some Medicare and Medicaid “profits.”  For example, the pharmacy, nursing and anesthesiology subsidiaries often all participate in a Medicare and Medicaid surgical operation.  When the Hospital prepares consolidated financial statements, it asks you whether the Hospital should “eliminate” gains on such transactions—especially if others consider such transactions as dealings with “regulated affiliates.”

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