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Auditing and Assurance Services (16th Edition)
16th Edition
ISBN: 9780134065823
Author: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
Publisher: PEARSON
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Question
Chapter 21, Problem 28DQP
a.
To determine
Indicate the amount of the actual misstatement in each of the four tests and state the consideration that affects the estimate of the misstatement for any item for which the amount cannot be ascertained from the given information.
b.
To determine
Explain the action that can be done about clerical accuracy tests of the inventory in the current year.
c.
To determine
Explain any changes that can be suggested in internal controls and procedures for Company M during the compilation of next year’s inventory to prevent each type of misstatement.
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Students have asked these similar questions
2. What piece of information gained during the understanding of the inventory process would be LEAST relevant to the scoping of inventory locations?
A. The company hired a new count supervisor for one of their largest locations
B. Book to physical adjustments were material in the prior year for 2 locations
C. Cycle count accuracy rates have been greater than management's targets in the prior year and current year to date
D. WIP inventory takes longer to count
1.
Please provide the type of audit procedures that was performed in the following actions or procedures:
Inquire of management whether they have properly identified obsolete inventory as at the balance sheet date ___________
Re-compute the unit sales price multiplied by the number of units for a sample of duplicate sales invoices, and compare the totals to the client’s calculations _____________________
Tom Pryor is conducting an audit of the computerized inventory system used by Zix Corporation. Tom has inserted
hypothetical data into the computer program that tracks inventory on a perpetual basis. Below are the hypotheical
data inserted by Tom:
Transaction
Beginning inventory
Purchase, day 1
Sale, day 2
Purchase, day 3.
Sale, day 4
Units
10
5
669
Cost per unit
$10
$11
$12
The computer program returned the following ending inventory values: FIFO perpetual, $96 LIFO perpetual,
$80 Moving average, $88
Which of the three values appears to be incorrect, and what "error" might be causing this condition?
Chapter 21 Solutions
Auditing and Assurance Services (16th Edition)
Ch. 21 - Prob. 1RQCh. 21 - Prob. 2RQCh. 21 - Prob. 3RQCh. 21 - Prob. 4RQCh. 21 - Prob. 5RQCh. 21 - Prob. 6RQCh. 21 - Prob. 7RQCh. 21 - Prob. 8RQCh. 21 - Prob. 9RQCh. 21 - Prob. 10RQ
Ch. 21 - Prob. 11RQCh. 21 - Each employee of the Gedding Manufacturing Co., a...Ch. 21 - Prob. 13.1MCQCh. 21 - Prob. 13.2MCQCh. 21 - Prob. 13.3MCQCh. 21 - Prob. 14.1MCQCh. 21 - Prob. 14.2MCQCh. 21 - Prob. 14.3MCQCh. 21 - Prob. 15.1MCQCh. 21 - Prob. 15.2MCQCh. 21 - Prob. 15.3MCQCh. 21 - Prob. 16DQPCh. 21 - Prob. 17DQPCh. 21 - Prob. 18DQPCh. 21 - Prob. 19DQPCh. 21 - Prob. 20DQPCh. 21 - Prob. 22DQPCh. 21 - Your client, Ridgewood Heating and Cooling,...Ch. 21 - Prob. 24DQPCh. 21 - Prob. 25DQPCh. 21 - Prob. 26DQPCh. 21 - Prob. 27DQPCh. 21 - Prob. 28DQPCh. 21 - Prob. 29DQP
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