If you haven't already done so, in the not-too-distant future you will prepare a résumé. In some ways your résumé is like a company's annual report. Its purpose is to enable others to evaluate your past, in an effort to predict your future.
A résumé is your opportunity to create a positive first impression. It is important that it be impressive—but it should also be accurate. In order to increase their job prospects, some people are tempted to “inflate” their résumés by overstating the importance of some past accomplishments or positions. In fact, you might even think that “everybody does it” and that if you don't do it, you will be at a disadvantage.
Some Facts
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The Trial Balance
About the Numbers
What do you think?
Using Radio Shack as an example, what should the company have done when it learned of the falsehoods on Mr. Edmondson's résumé? Should Radio Shack have fired him?
No: Mr. Edmondson had been a Radio Shack employee for 11 years. He had served the company in a wide variety of positions, and had earned the position of CEO through exceptional performance. While the fact that he lied 11 years earlier on his résumé was unfortunate, his service since then made this past transgression irrelevant. In addition, the company was in the midst of a massive restructuring, which included closing 700 of its 7,000 stores. It could not afford additional upheaval at this time.
Yes: Radio Shack is a publicly traded company. Investors, creditors, employees, and others doing business with the company will not trust it if its leader is known to have poor integrity. The “tone at the top” is vital to creating an ethical organization.
Tips on résumé writing can be found at many websites, such as http://resume.monster.com/.
The authors' comments on this situation.
The decision whether to fire Mr. Edmondson was the responsibility of Radio Shack's board of directors, which is elected by the company's shareholders to oversee management. The board initially announced its support for the CEO. After further investigation, the board encouraged Mr. Edmondson to resign, which he did. In contrast, when Bausch & Lomb's CEO offered to resign in a similar situation, the company's board refused to accept his resignation. Board members stated that they felt he was still the best person for the position.
Radio Shack says that although it did a reference check at the time of Mr. Edmondson's hiring, it did not check his educational credentials. Under the Sarbanes-Oxley Act of 2002, companies must now perform thorough background checks as part of a check of internal controls. The bottom line: Your résumé must be a fair and accurate depiction of your past.
· David Edmondson, the president and CEO of well-known electronics retailer Radio Shack, overstated his accomplishments by claiming that he had earned a bachelor's of science degree, when in fact he had not. Apparently his employer had not done a background check to ensure the accuracy of his résumé.
· A chief financial officer of Veritas Software lied about having an M.B.A. from Stanford University.
· A former president of the U.S. Olympic Committee lied about having a Ph.D. from Arizona State University. When the truth was discovered, she resigned.
· The University of Notre Dame discovered that its football coach, George O'Leary, lied about his education and football history. He was forced to resign after only five days.
· A survey by Automatic Data Processing reported that 40% of applicants misrepresented their education or employment history.
· A survey by the Society for Human Resource Management of human resource professionals reported the following responses to the question, “When investigating the backgrounds of job candidates, how important or unimportant is the discovery of inaccuracies in the job candidate's résumé on your decision to extend a job offer?”
Source: Society for Human Resource Management, press release, August 31, 2004, http://www.shrm.org/press/ntu_published/cms_009624.asp.
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Comprehensive
DO IT!
Transactions
Bob Sample and other student investors opened Campus Laundromat Inc. on September 1, 2011. During the first month of operations the following transactions occurred.
The chart of accounts for the company is the same as for Pioneer Advertising Agency Inc. except for the following: No. 154 Laundry Equipment and No.
610 Advertising Expense.
Instructions
Action Plan
Solution to Comprehensive
Sept. 1 Stockholders invested $20,000 cash in the business.
2 Paid $1,000 cash for store rent for the month of September.
3 Purchased washers and dryers for $25,000, paying $10,000 in cash and signing a $15,000, 6-month, 12% note payable.
4 Paid $1,200 for a one-year accident insurance policy.
10 Received a bill from the Daily News for advertising the opening of the laundromat $200.
20 Declared and paid a cash dividend to stockholders $700.
30 Determined that cash receipts for laundry fees for the month were $6,200.
(a) Journalize the September transactions. (Use J1 for the journal page number.) (b) Open ledger accounts and post the September transactions.
(c) Prepare a trial balance at September 30, 2011.
Make separate journal entries for each transaction.
In journalizing, make sure debits equal credits.
In journalizing, use specific account titles taken from the chart of accounts.
Provide appropriate description of each journal entry.
Arrange ledger in statement order, beginning with the balance sheet accounts.
Post in chronological order.
Use numbers in the reference column to indicate the amount has been posted.
In the trial balance, list accounts in the order in which they appear in the ledger.
List debit balances in the left column, and credit balances in the right column.
(a)
GENERAL JOURNAL J1
Date Account Titles and Explanation Ref. Debit Credit
2011
Sept. 1 Cash 101 20,000
Common Stock 311 20,000
(Stockholders' investment of cash in business)
2 Rent Expense 729 1,000
Cash 101 1,000
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(Paid September rent)
3 Laundry Equipment 154 25,000
Cash 101 10,000
Notes Payable 200 15,000
(Purchased laundry equipment for cash and 6-month, 12% note payable)
4 Prepaid Insurance 130 1,200
Cash 101 1,200
(Paid one-year insurance policy)
10 Advertising Expense 610 200
Accounts Payable 201 200
(Received bill from Daily News for advertising)
20 Dividends 332 700
Cash 101 700
(Declared and paid a cash dividend)
30 Cash 101 6,200
Date Explanation Ref. Debit Credit Balance 2011 Date Explanation Ref. Debit Credit Balance 2011
Sept. 4 J1 1,200 1,200
Laundry Equipment No. 154 Date Explanation Ref. Debit Credit Balance 2011
Sept. 3 J1 25,000 25,000
Service Revenue No. 400
Date Explanation Ref. Debit Credit Balance 2011
Sept. 30 J1 6,200 6,200
Notes Payable No. 200
Date Explanation Ref. Debit Credit Balance
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2011
Sept. 3 J1 15,000 15,000
Accounts Payable No. 201 Date Explanation Ref. Debit Credit Balance 2011
Sept. 10 J1 200 200
Common Stock No. 311
Date Explanation Ref. Debit Credit Balance 2011
Sept. 1 J1 20,000 20,000
Dividends No. 332
Date Explanation Ref. Debit Credit Balance 2011
Sept. 30 J1 700 700
Advertising Expense No. 610 Date Explanation Ref. Debit Credit Balance 2011
Sept. 10 J1 200 200
Rent Expense No. 729
Date Explanation Ref. Debit Credit Balance 2011
Copyright © 2010 John Wiley & Sons, Inc. All rights reserved.
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The Trial Balance
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