In connection with her audit of Flowmeter, Inc., for the year ended December 31, 19X8, Hirsch, CPA, is aware that certain events and transactions that took place after December 31, 19X8, but before she issues her report dated February 28, 19X9, may affect the company's financial statements.

The following material events or transactions have come to her attention.

a. On January 3, 19X9, Flowmeter, Inc., received a shipment of raw materials from Canada. The materials had been ordered in October 19X8 and shipped FOB shipping point in November 19X8.

b. On January \(15,19 \times 9\), the company settled and paid a personal injury claim of a former employee as the result of an accident that occurred in March 19X8. The company had not previously recorded a liability for the claim.

c. On January 25, 19X9, the company agreed to purchase for cash the outstanding stock of Porter Electrical Company. The acquisition is likely to double the sales volume of Flowmeter, Inc.

d. On February 1, 19X9, a plant owned by Flowmeter, Inc., was damaged by a flood and an uninsured loss of inventory resulted.

e. On February 5, 19X9, Flowmeter, Inc., issued and sold to the public \(\$ 2\) million in convertible bonds.

Required:

For each of the events or transactions above, indicate the audit procedures that should have brought the item to the attention of the auditor and the form of adjustment or disclosure in the financial statements, including the reasons. Arrange your answer in the following format:

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Item No. Audit Procedures Adjustment or Disclosure and Reasons