As a part of your clerical tests of inventory for Martin Manufacturing, you have tested about 20% of the dollar items and have found the following exceptions:
1. Extension errors:

2. Differences located in comparing last year€™s costs with the current year€™s costs on the client€™s inventory lists:

3. Test counts that you were unable to find when tracing from the test counts to the final inventory compilation:

4. Page total, footing errors:

a. State the amount of the actual misstatement in each of the four tests. For any item for which the amount of the misstatement cannot be determined from the information given, state the considerations that will affect your estimate of the misstatement.
b. As a result of your findings, what will you do about clerical accuracy tests of the inventory in the current year?
c. What changes, if any, would you suggest in internal controls and procedures for Martin Manufacturing during the compilation of next year's inventory to prevent each type ofmisstatement?

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Description Wood Quantity 920 board feet Price Extension as Recorded $0.12/board foot 12 Metal-cutting tools Cutting fluid Sandpaper 49 units 26 barrels 600 sheets 11.04 1,740.00 240.00 579.00 30.00 each 40.00/barrel 0.95/hundred Description antity Yars Cost Preceding Year's Cost TA-114 precision-cutting torches2 units 800.00 each Aluminum scrap Lubricating oil 4,500 pounds 400 gallons 8.00/ton 55.00/gallorn Unable to locate $95.00/torn 95.00/barrel Tag No. 2958 0026 Quantity 20 tons 3,000 feet Description Cold-rolled bars 4-inch aluminum stripping Current Year Cost $75.00/ton 2.25/foot Client Total Correct Total Page No. 14 82 2,375.36 6,721.18 $2,375.30 6,421.18