http://www.cbc.ca/money/story/2010/01/15/consumer-corporate-haiti-donations.html
Summary:
A natural disaster had struck Haiti about a week ago causing thousands and thousands of deaths and thousands buried underground. Canadian Businesses have committed millions of dollars in aid for victims of the earthquakes. Companies like BMO, Roger, National Bank of Canada, TD Bank, IKEA, etc have donated money to help aid the situation. Credit Card Company such as Visa, MasterCard and American Express will suspend interchange fees on Haitian relief donations to certain organizations. Western Union and Money Gram have suspended fees on transactions for charitable donations to the relief effort. Air Transat has temporarily suspended its weekly flight to Haiti because the airport is unable to receive it.
Connection:
The connection I have made with this article to chapter 3 is that the donation that the companies are donating to aid the earthquake are consider infrequent event. Infrequent events are a special thing that is infrequent and unusual. It is always recorded in a separate section in the multi-steps income statement. The companies that have donated money to aid the Haiti earthquake crisis should record their donations during the “Prepare Financial Statements” section of the accounting cycle. The donations should be recorded in the infrequent event section of the multi-steps income statements. This will show that the company had done something with their money, instead of not knowing where the money went. Natural disaster like this does not happen often; therefore, donations like from these companies should be considered infrequent events.
Reflections:
The Haiti earthquake was a sad and unpredictable event. It is nice to see that people from all around the world are doing something to help out the ones who are needed. Many large companies had donated money to aid the crisis. Credit card companies are willing to earn less money by suspending transaction fees for charitable donations. Even people who are not from big companies are contributing to aid the people in Haiti. It was an event that devastated the whole world. The amounts of people who died and buried are increasing.
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I agree with you Sen. The earthquake that hit Haiti was a sad a tragic event that affected many people around the world. I think it is great that so many companies are donating to the cause. Making donations will help the companies promote a better image, bring in more customers and at the same time help those in need in Haiti. I think another connection to the financial accounting textbook could be discontinued operations. Due to the earthquake many companies and parts of companies were destroyed. This probably caused many companies to shut down some of their segments that were connected to Haiti. I hope Haiti will recover from this tragedy soon and that another earthquake wont be hitting there anytime soon.
ReplyDeleteSam Hui
Day 1 Period 2
Financial Accounting 12
While I agree it is a great thing that so many companies are donating to the Haiti Relief Fund and banks are removing tranfer fees, I think it is not because they are "nice". Extraordinary events like this can help one company's image, as Sami said. If you don't donate or remove the transfer fees while everyone else does, you will be criticized immensely. I also think that this is no different from sponsoring athletes as you are promoting yourself. I could be wrong about it and maybe they all believed it was the right thing to do and it came from the "kindness of their heart".
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