ABSTRACT: Shreffler Stores, a large, diversified holding company in the retail industry has recently acquired Value Amalgamated Lots (VAL), a catalog retailer. In the following Problem-Based Learning unfolding problem, students will assume the role as a member of the financial reporting team, working on the Shreffler Stores’ annual report for several periods. Students will focus on issues relating to the operations of VAL, the subsequent impact on the financial reports of Shreffler Stores, and how results drive later management decisions. The events were taken from an actual case encountered in the conduct of an audit performed by a public accounting firm. Among the accounting concepts addressed are accounts receivable, impairments of different kinds of assets, and accounting for discontinued operations. The problem can be used as a whole in a capstone course or in pieces as part of an intermediate course.

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