37 te BIU fx C A B 39 40 41 EARTHWEAR CLOTHERS Planning Materialty December 31, 2022 A D E F 1. Benchmark Data Sales/Revenue Pre-tax income Total assets Materiality 2. Establish Planning Materialty Level Measurement Base (thousands) Unaudited 2022 2021 $1,019,890 $950,484 $70,154 $35,757 $389,428 $329.959 $1,300 Select Measurement Base Using The Yellow Cell on the Left Percentage Appled Input a Percentage Here Based on the Guidelines Below Planning Materiality Bases and Percentage Ranges: Proft Oriented Fastes Pre-tax income Please Complete Cels Above Total Revenue Total Asse For pubkampas 5% poly he No-or-Proft Endtes Total Revenue Total Assets Mutual Fund Eries Net Asset Value 3-7% 05-3% Gures The 025-25 05.3% 025-2% 3-5% 3.Justify Support Your Level of Planning Materialty State the factors that you considered to determine the appropriate measurement base and percentage to determine planning materialty Measurement Base: Enter your response here Percentage: Enter your response here 3.7 MG 20002 Instructions Work Paper 3-7 Work Paper 3-8 Balance Sheet Income Sta Ready te BIU X fx B C EARTHWEAR CLOTHIERS Planning Materiality December 31, 2022 (In thousands) Unaudited 2022 A 1. Benchmark Data Sales/Revenue Pre-tax income Total assets Materiality 2. Establish Planning Materiality Level Measurement Base Sales/Revenue Pre-tax income Total assets Bases and Percentage Ranges: Profit Oriented Entities Pre-tax income $1,019,890 $70,154 $389,428 Select Measurement Base Using The " Input a Percentage Here Based on the Please Complete Cells Above Total Revenue Total Assets 3-7% 0.5-3% Please use this tem Guidelines. The ma 0.25-2% be used only as an planning materialty For public companies, 5% is typically the maum Not-for-Profit Entities Total Revenue Total Assets Mutual Fund Entities Net Asset Value 0.5-3% 0.25-2% 3-5% 3. Justify/Support Your Level of Planning Materiality State the factors that you considered to determine the appropriate measurement bar planning materiality Measurement Base Enter your response here Percentage Enter your response here 2022 United Tolerable 10 Account Na Cash and cash equiv 2021 Trial Relance Mastatement Belance 548578 $79,359 Receivables, nat R 25% 512375 $2.961 IN 25% 12 very $122337 $147.493 13 Pix $17772 $15,647 1% 29% 14 Deemed income tax benef $7.132 32.585 15 Property Plant & Equipm 1206426 34 es 16 187722 $24431 M 29% 29% change year 17 3423 1734 5434 es 10 Lines of $11,011 $10.510 12827 15% P 20 Accrued labies & Accred posing 33.600 14400 ON 20% 21 befas pepe & Delemet income s 134347 16.142 es 21 Common sok, 26.121 $201 $261 14 11% 23 D $5.400 $5400 $130 25% 24 Aedonal paid-in $30740 $25.719 0% 0% Le change or yw, not fo 25 Deemed compensation 37 " M Accumulated other $2,173 5543 0% 20% hose complex tons of GA $317.907 17 Randings Treasury sook 6.546 and 6,706 shares at cost, respectively $143953) $134.512) 10 0% 0% Total Amount of Telerable Misstatement Allocated To Balance Sheet Accounts Planning Materiality (from work paper 3-7) Ratio of Total Telerable Miestatement to Planning Materialty Compte Work Pa 04 The C222 Wills & Adam Tolerable Misstatement Tolerable misstatement should be between 50% and 75% ofpansing marially Tolerable risstatement should not exceed 25% of the account The toll amount of tolerable niutalement alocated to balance sheet accounts should be below nes alty is order to init aggreg