Saunders Technologies Ltd.'s (Saunders) balance date is 30 March. Here is information relating to the expected...

 

 

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Saunders Technologies Ltd.'s (Saunders) balance date is 30 March. Here is information relating to the expected financial information for 2021. In 2020, the actual cash balance was $527,000 but due to changes in circumstances, the company expects to have a bank overdraft of $206,000 in 2021. The Trade Receivables are expected to increase from $580,000 to $899,000 over this period while the Inventory account will increase by $95,000 from a balance of $380,000 in 2020. The Trade payables will also increase from $274,000 to $370,000 in 2021. In terms of Revenue, Saunders expects an increase of $1,236,000 on their current revenue of $4,120,000. The cost of sales will also increase from $2,290,000 to $2,519,000. It is expected that the operating expenses will change from $950,000 in 2020 to $1,729,000 in 2021. Required: Question 1.1: (1 mark)- What is the increase in revenue? What is the increase in cost of sales? % (Round to the nearest whole percentage. Do not type in the sign "%"). What is the increase in gross profit? Question 1.2: (2 marks)e Explain the audit risk related to the figures in Question 1.1. (This is a short written answer with a maximum of 50 words). Saunders Technologies Ltd.'s (Saunders) balance date is 30 March. Here is information relating to the expected financial information for 2021. In 2020, the actual cash balance was $527,000 but due to changes in circumstances, the company expects to have a bank overdraft of $206,000 in 2021. The Trade Receivables are expected to increase from $580,000 to $899,000 over this period while the Inventory account will increase by $95,000 from a balance of $380,000 in 2020. The Trade payables will also increase from $274,000 to $370,000 in 2021. In terms of Revenue, Saunders expects an increase of $1,236,000 on their current revenue of $4,120,000. The cost of sales will also increase from $2,290,000 to $2,519,000. It is expected that the operating expenses will change from $950,000 in 2020 to $1,729,000 in 2021. Required: Question 1.1: (1 mark)- What is the increase in revenue? What is the increase in cost of sales? % (Round to the nearest whole percentage. Do not type in the sign "%"). What is the increase in gross profit? Question 1.2: (2 marks)e Explain the audit risk related to the figures in Question 1.1. (This is a short written answer with a maximum of 50 words).

Answer rating: 100% (QA)

11 Increase in Revenue 30 Increase in Cost of sales 10 Increase in Gross Profit ... View the full answer