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•Lisa Martin was promoted to the position of controller since IRCS. •IRCS saw a way to acquire DETRAS systems for cheap from classic market rates, yet IRCS did not have sufficient money which built them have a loan to get 10 , 000, 000. •IRCS is required to maintain a a insurance ratio of three, or else it will violate the money covenant and would have to repay the loan immediately. •IRCS need to provide monthly financial transactions in accordance with GAAP. •Lisa Matn conducted an inventory impairment evaluation to determine if inventories were correctly reported at decrease of cost or marketplace. •The impartment test performed by Martin calculated a loss of $538, 005 as a result of three slow-moving CPU items. •With losing in mind, Martin thought about the idea of still advertising the items at their cost, yet Jeff confirmed that they can would have to offer them at low cost. •Impairment loss will cause the corporation to break thee interest coverage percentage debt covenant. •Lang asked Martin to discover a way to be able to stop the loss, he did not care if they performed unethical actions. •Lang presented an update to Martin with an buy from one of their customers, however , the information presented was not ethical as some of the items were below industry values,. •Martin found out via Scott that that they were able to obtain a superior for by giving discounts in other items, however , Harvey asked for the information to be secret and not to informed any accountant. •ASC- 330-10-35-10 claims that lower-of-cost-or-market should be connect with the inventory when there exists only one end product and when products on hand items are well balanced. Martin recognized that their particular inventory is usually on an item by item basis. ASC also says that the impairment test should be applied consistently from year to year. •Edmonds asked martin to perform lower-of-cost-or market rule to all or any the inventory. Martin did so and found out that there was no need to guide them with a loss.

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