The shareholders of Enrot Corporation lost their entire investment when Enrot filed for bankruptcy. Enrot had no
Question:
The shareholders of Enrot Corporation lost their entire investment when Enrot filed for bankruptcy. Enrot had no assets remaining after creditors had been paid. The shareholders sued and were awarded a $10,000,000 court judgement for negligence against the CPA general partnership which audited the financial statements of Enrot.
Addition facts;
The CPA partnership has an insurance policy which covers the negligent acts of the CPA's. in the amount of $5,000,000.
The net assets of the CPA partnership amount to $2,000,000.
The net assets of the partners are as follows;
Partner Net Assets
A $ 100,000
B $ 2,000,000
C $ 4,000,000
Total $ 6,100,000
Required:
Make a detailed, step-by-step, chronological plan for the shareholders (your clients) for the full collection of their $10,000,000 judgement.
Question :
Little Billy is 16 years old and agreed to purchase a new computer from a computer store. Terms of sale called for payment to be made 30 days after delivery. Little Billy received the computer and completely destroyed the computer while setting it up in his bedroom (there was no fault attributable to the computer store or the product itself). Little Billy refuses to pay the purchase price.
Required: Advise the computer store owner on the collection the purchase price.
Auditing a business risk appraoch
ISBN: 978-0324375589
6th Edition
Authors: larry e. rittenberg, bradley j. schwieger, karla m. johnston