EBK AUDITING+ASSURANCE SERVICES
17th Edition
ISBN: 9780135171219
Author: ARENS
Publisher: PEARSON CO
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Chapter 5, Problem 28C
1.
To determine
Provide reasons for the conclusions stated.
2.
To determine
Provide reasons for the conclusions stated.
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Ma1.
John Anderson, CPA, is auditing the financial statements of American Turkey and Taco Cat, a privately owned company, for the year ended December 31, 2019. Anderson plans to complete fieldwork and sign the auditor's report about March 10, 2020. Anderson is concerned about events and transactions occurring after December 31, 2019, that may affect the 2019 financial statements.
What general types of subsequent events require Anderson's consideration and evaluation?
What auditing procedures should Anderson consider performing to gather evidence concerning subsequent events?
You are assigned to perform a review of minutes of meeting for the year end audit
ending December 31, 2021. Which of the following agendas would least likely affect
the total liabilities of the entity?
A. The payment of real property taxes for the year 2021 at the beginning of 2021.
B. The approval of the board of directors of the issuance of a S-year term bond last September
2021.
C. Property dividends declared on December 27, 2021
D. The settlement of a pending litigation with another entity on January 5, 2022.
The fieldwork for the December 31, 2018 audit of Schmidt Corporation ended on March 17, 2019. The financialstatements and auditor's report were issued on March 29, 2019. In each of the material situations (1 through 5)below, indicate the appropriate action (a, b, c). The possible actions are as followsa. Adjust the December 31, 2018 financial statements.b. Disclose the information in a footnote in the December 31, 2018 financial statements.c. No action is required.The situations are as follows:________ 1. On March 1, 2019, one of Schmidt Corporation's major customers declared bankruptcy. The customer'sfinancial condition in 2018 was deteriorating and they owed Schmidt Corporation a large sum of money as of thebalance sheet date.________ 2. On February 17, 2019, Schmidt Corporation sold some machinery for its book value.________ 3. On February 20, 2019 a flood destroyed the entire uninsured inventory in one of Schmidt'swarehouses.________ 4. On January 5, 2019, there was a significant…
Chapter 5 Solutions
EBK AUDITING+ASSURANCE SERVICES
Ch. 5 - Prob. 1RQCh. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Prob. 4RQCh. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - Prob. 7RQCh. 5 - Prob. 8RQCh. 5 - Prob. 9RQCh. 5 - Prob. 10RQ
Ch. 5 - What potential sanctions does the SEC have against...Ch. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14.1MCQCh. 5 - Prob. 14.2MCQCh. 5 - Prob. 14.3MCQCh. 5 - Prob. 15.1MCQCh. 5 - Prob. 15.2MCQCh. 5 - Prob. 15.3MCQCh. 5 - Prob. 16.1MCQCh. 5 - Prob. 16.2MCQCh. 5 - Prob. 16.3MCQCh. 5 - Prob. 17DQPCh. 5 - Prob. 18DQPCh. 5 - Prob. 19DQPCh. 5 - Prob. 20DQPCh. 5 - Prob. 21DQPCh. 5 - Prob. 22DQPCh. 5 - Prob. 23DQPCh. 5 - Prob. 24DQPCh. 5 - Prob. 27DQPCh. 5 - Prob. 28C
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