n 12 September, the auditor became aware that a fire burnt down one of TGL’s warehouses, resulting in a loss of 40% of the inventory that was on hand at that date. On 30 September, management discovered that Johnno, a major debtor of TGL who was facing financial difficulties, became bankrupt on 15 September. All sales
n 12 September, the auditor became aware that a fire burnt down one of TGL’s warehouses, resulting in a loss of 40% of the inventory that was on hand at that date. On 30 September, management discovered that Johnno, a major debtor of TGL who was facing financial difficulties, became bankrupt on 15 September. All sales
Chapter4: The Adjustment Process
Section: Chapter Questions
Problem 4TP: Assume you are employed as the chief financial officer of a corporation and are responsible for...
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Write whether the following events are considered as event occurring after the end of reporting period. Also explain whether these events are adjusting events or non-adjusting.
- On 12 September, the auditor became aware that a fire burnt down one of TGL’s warehouses, resulting in a loss of 40% of the inventory that was on hand at that date.
- On 30 September, management discovered that Johnno, a major debtor of TGL who was facing financial difficulties, became bankrupt on 15 September. All sales to Johnno were made before the end of the financial year.
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