TWO PART QUESTION: Part 1: NetSolutions Software System has a year-end of December 31st, which falls on a Wednesday. NetSolutions employees always get paid every Friday so at the year-end, there is $187,350 in the Accrued Payroll account. NetSolutions weekly payroll is typically about $312,000. (Assume a 5 day week)

Using analytical procedures for the Accrued payroll account, develop an expectation for the accrued payroll account.

Part 2: Considering the expectation you have developed for accrued payroll in the previous question, which of the following statements best describes your conclusion? Multiple Choice.

a. The accrued payroll account has a high risk of material misstatement therefore I will plan to perform extensive tests of details

b. I will perform extensive tests of control

c. I will plan to perform minimal tests of detail because my expectation is very close to the client's amount

d. The accrued payroll account is materially misstated