PROBLEM NO. 3 In the audit of the books of Greenwich Company for the year 2020, the following items and information appeared in the Production Machines account of the auditee: Date Particulars Debit Credit 2020 Jan. 01 Balance-Machines 1, 2, 3, and 4 at P90,000 each Machine 5 Aug 31 Machine 1 Sept 30 Machine 6 Dec 01 Machines 7 and 8 at P216,000 each Dec 01 Machine 2 31 Balance P 360,000 198,000 P 3,000 96,000 432,000 21,000 1,062,000 P1,086,000 P1,086,000
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- BER 2021 CONFIDENTIALEAB31103_Audit 2 Page 9 of 10Question 5Nurin, Aliah & Co has audited Kinokuyi Publishing Sdn Bhd (KPSB) for several years. Auditdocumentation, including internal control flowcharts as well as sales and cash receipts system,purchasing and payables system and payroll system notes, are accessible from the previousyear's file. You are the audit supervisor of Nurin, Aliah & Co, and you are evaluating thepaperwork documenting KPSB’s purchasing and payables system in preparation for theinterim and final audits for the fiscal year ending 31 December 2021. The company is a bookretailer with twelve locations across the Klang Valley and a central warehouse located in ShahAlam which holds the majority of the company's inventory. Below is an excerpt from theexisting systems notes:Store managers are in charge of placing book orders for their store. Store managers arecurrently unable to request books from any of the other eleven locations. Customers who wantto order books…You are the senior in charge of the audit of the accounts of the Domino Industries, Inc. You and your staff have just completed the field work relative to the December 31, 2020 audit. The adjusted trial balance and certain additional information related thereto appearing in your working papers are as follows: Cash 240,000 Marketable Securities 95,000 Investment in Affiliated Companies 350,000 Accounts Receivable (including P120,000 due after one year) 680,000 Subscription Receivable 20,000 Inventories - Finished Goods 620,000 - Goods in Process 155,000 - Raw Materials 470,000 Treasury Stock (cost of 100 shares) 11,000 Construction in Progress 220,000 Land 460,000 Buildings, Machinery and Equipment 4,350,000 Cash Surrender Value of Life Insurance 60,000 Prepaid Expenses 50,000 Pre-operating Expenses 120,000 Unamortized…Which required SEC filing would contain the following content? "Our auditors identified the following critical audit matter: The Company recorded $219.4 million as of December 31, 2020 in reserves for returns, allowances, markdowns and discounts within customer refund liability." Question 33 options: a) Proxy b) 10-K c) 8-K
- For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation’s liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier’s debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer’s credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation’s liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier’s debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer’s credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation's liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: • Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier's debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer's credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. • The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…
- For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation's abilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier's debit balance of P30,000, On the other hand, the testing of the accounts receivable account revealed that a customer's credit balance of P50,000 was netted against the balance of the accounts receivable At December 31, 2021, EMPLEO declared a cash dividend at PO.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…9999...last recheck You have completed the field work in connection with your audit of Carla Corporation for the year ended December 31, 2020. The balance sheet accounts at the beginning and end of the year are shown below. Dec. 31,2020 Dec. 31,2019 Increase or(Decrease) Cash $311,248 $333,760 ($22,512 ) Accounts receivable 525,755 395,360 130,395 Inventory 830,704 683,200 147,504 Prepaid expenses 13,440 8,960 4,480 Investment in subsidiary 123,760 0 123,760 Cash surrender value of life insurance 2,580 2,016 564 Machinery 231,840 212,800 19,040 Buildings 599,424 456,848 142,576 Land 58,800 58,800 0 Patents 77,280 71,680 5,600 Copyrights 44,800 56,000 (11,200 ) Bond discount and issue cost 5,042 0 5,042 $2,824,673 $2,279,424 $545,249…You are the auditor in charge of the audit of Irene PLC, which has a 30 June year end. The subsequent events review for the year ended 30 June 2022 revealed that, on 1 August 2022, a receiver was appointed at a major customer. At 30 June 2022 that customer owed GHS 150,000 and goods costing GHS 200,000 made to that customer’s specification were held in inventory. Both these amounts are material.RequiredList the matters to which you would direct your attention in respect of the above in relation to the audit for the year ended 30 June 2022, if the audit report on the financial statements has not yet been written.
- QUESTIONS. A. Based on the above and the result of your audit, answer the following(Round off present value factors to four decimal places and final answers to nearest hundred) 1. The consultation service fee revenue that should be recognized in 2022 is 2. The gain on We of equipment that -should be recognized in 2022 is 3. The noncurrent notes receivable as of December 31, 2022 is 4. The current-portion of long-term notes receivable as of December31, 2022 is 5. The interest income to be recognized in 2022 is B. Show the amortization schedule for December 31, 2022.(b) You are the audit senior on the audit of Marsa Ltd, a large manufacturing company, for theyear ended 30 June 2020. It is now 16 July 2020 and you are reviewing the audit working papersprepared by the audit assistant, Trena Berk. You notice the following matters:(i) As part of her work on subsequent events since balance date, Trena noted that therewere a large number of returns in July of product XLP. However, as this product wasfirst sold in June and represented only 1 per cent of sales for the year, she concludedthat the amount was immaterial and that no further work was necessary.(ii) Trena selected 20 invoices to test the control that the salesclerk checks that the pricesagree with the authorised price list. She found three instances where the salesclerkhad not signed the ‘prices checked’ box on the invoice. The sales manager explainedthat the salesclerk always checks the prices, but sometimes forgets to sign the box. Asthe prices on all the invoices agreed with the authorised…You are evaluating audit results for assets in the audit ofRoberts Manufacturing. You set the preliminary judgment about materiality at $50,000.The account balances, performance materiality, and estimated overstatements in theaccounts are shown next.Account Performance Estimate of TotalAccount Balance Materiality OverstatementsCash $ 50,000 $ 5,000 $ 1,000Accounts receivable 1,200,000 30,000 20,000Inventory 2,500,000 50,000 ?Other assets 250,000 15,000 12,000Total $4,000,000 $100,000 ? a. Assume you tested inventory amounts totaling $1,000,000 and found $10,000 inoverstatements. Ignoring sampling risk, what is your estimate of the total misstatement in inventory?b. Based on the audit of the assets accounts and ignoring other accounts, are the overallfinancial statements acceptable? Explain.c. What do you believe the auditor should do in the circumstances?