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Lakeside

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The Lakeside Company:
Auditing Cases

SOLUTIONS MANUAL 12e

Table of Contents

John M. Trussel and J. Douglas Frazer

A Note on Ethics, Fraud and SOX Questions 2

A Note on Research Assignments 3

Introductory Case 5

Case 1 14

Case 2 22

Case 3 33

Case 4 44

Case 5 58

Case 6 74

Case 7 82

Case 8 92

Case 9 101

Case 10 110

Case 11 116

Case 12 125

Case 13 136 A NOTE ON ETHICS, FRAUD, AND SOX QUESTIONS

The Lakeside Company: Auditing Cases, 12th edition, has been updated in light of the accounting
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The assignments are simply not intended to be exercises in arriving at a predetermined answer. Rather, the applications of the suggested readings have the following objectives:

- To provide a means for improving the writing skills of students. From all reports, accounting majors too often leave college lacking in the basic ability to compose and construct sentences and paragraphs. Accounting and auditing (especially as one moves up in an organization) obviously require skills other than the purely quantitative. Memos, reports, footnotes, audit and accounting guides, etc., all require accountants and auditors to be effective communicators of the written word. Indeed, the instructor may want to team up with a member of the school's English or communications department to enhance the effectiveness of these assignments. The auditing instructor can then evaluate the technical and research portions of the assignment, while the English instructor would make suggestions as to grammar, syntax, construction of sentences and paragraphs, logic of the thought process, etc. As a preliminary step, the instructor may want to assign articles such as "Word Crunching: A Primer for Accountants" from the March 1990 issue of the Journal of Accountancy.

- To introduce students to accounting and business journals as well as other important publications. After college, students
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