Operating Expense and Capital Investment
Absolutely no plagiarism, must be original and simple, very thorough. Please make sure everything is followed in the question and the grading rubric. Must include academic relevant resources. Must include in-text citations. Please also make sure everything in the rubric as well as assignment is covered.
Question: Although this module focuses on how to account for leases, it raises a larger question about when a company should treat an item as an operating expense or as a capital investment. Please research this question and identify several other instances in which outlays can be recorded either as an operating expense or as a capital investment.
Please conduct independent research and focus your submission on the Worldcom scandal in which the company was convicted of incorrectly reporting ‘line costs’ in its financial statements?
Write up your findings in a 3-page paper, double-spaced, using 10-12-point font. No abstract please. In addition to providing several well-explained examples, please also indicate how firms choose whether to show the item as an operating expense or a capital investment.
Hints for Success
- When your assignment requires research, remember to use credible sources, add in-text citations to give credit where credit is due, and provide references using APA style. If APA is new to you, review the APA resources in the Student Resource Center.
Assignment Rubric (1)
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| Criteria | Ratings | Pts | |
| This criterion is linked to a Learning Outcome Critical Thinking |
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| This criterion is linked to a Learning Outcome Content and Development |
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| This criterion is linked to a Learning Outcome Organization and Length |
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| This criterion is linked to a Learning Outcome Sentence Structure, Grammar, Spelling and APA Form and Style |
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| This criterion is linked to a Learning Outcome Timely Submission |
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Answer preview
Accounting ethics clearly outline the misleading financial statements as a fraud that would mislead other stakeholders in the economy such as the investors. Operating expenditures are incurred in the engagement of the activities that are not directly associated with the production of goods and services (Brooks, 2015). Capital investment on the other hands is funds that are reinvested into the organization with the purpose of expanding its objectives…
(900 words)