Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember...

  

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Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan Sloan CPA is auditing the financial statements of Wallen Company for the year ended on De-cember 31, 20X7. The following is a summary of the uncorrected misstatements that Sloan has identified during the past three years. These misstatements are immaterial and have related to isolated matters. A positive amount indicates that the misstatement overstates the related line item. For example, the net income is overstated by $62,500 due to the misstatement in 20X4. During the most recent audit for 20X7, Sloan concluded that expenses totaling $67,000 were recognized in January of 20X8 (when Wallen paid them) but should have been recognized in 20X7. For the purpose of this question, assume that the income tax rate is 35%. Please do not use comma in the numbers of your response. Effect on net income Effect on assets Effect on liabilities Effect on equity 62,500 20X4 62,500 90,000 27,500 20X5 22,700 35,100 12,400 22,700 20X6 -43,000 -43,000 -43,000 A) Under the rollover method, the misstatement of net income is S Under the iron curtain method, the misstatement of net income is $ The auditor performs the following audit procedures on the inventory of a client in the mamifacturing industry. Match each of the audit procedure below with the corresponding management assertion that the audit procedure is intended to verify. Test counted inventory and traced the count to the perpetual inventory record Selected a sample of inventory items from the perpetual records and vouch additions to receiving reports A Valuation and accuracy. Selected a sample of inventory items from perpetual B.Existence. • inventory report and compare their unit cost to the most recent vendor invoices C. Presentation and dis-closure, Review inventory footnotes in the financial statements D. Rights and obligations. to see whether inventories are properly categorized E Completeness. into raw materials, working-in-process, and finished goods Reviewed the loan agreement to see if inventories are pledged as collateral for the bank loan