There are some questions for Auditing needs to be solved.

1. What is audit evidence (15 points)? Define audit evidence. Provide three examples of audit evidence and explain why you believe that each example is audit evidence a. b. Discuss the two attributes of audit evidence and provide one example of each attribute to complete your discussions. Be specific and thorough when discussing each attribute or criteria. 2. Analytical Procedure Problem (25 points). Provided below is a set of financial statements (Balance Sheet and Income Statement) for Mavo, Inc, our new audit client. A worksheet for calculating percentages and ratios is also provided (Use the Excel template to be more efficient). Required 1. Foot the Financial statements to ensure that they are correct. 2. Complete and calculate the vertical and horizontal analysis for both the income statement and the partial balance sheet provide for 2018. Calculate the Turnover ratios in the space provided for 2017 through 2018 at the bottom of the worksheet. Examine and Review your vertical and horizontal analysis and then identify and discuss: 3. 4. a. One obvious red flag you found in the Income statement. What may be wrong with the Accounts receivable and the allowance for doubtful accounts? Discuss the potential sources of misstatement if you found one in this account. b. Do you believe the client is potentially overstating or understating accounts? Support your answer persuasively by giving concrete examples c. 5. Look at the ratios you calculated. What can you conclude about the potential misstatements of this client? Blank Sheet for Calculating Ratios Table 2, NKU, Inc. Current Ratio 2017 2018 Days' sales in receivables Days' sales in inventony Receivable Turnover Inventory Turnover