You are evaluating the results of a nonstatistical sample of 85 accounts receivable confirmations for the Bohrer Company. Information on the sample and population are included below. An overstatement or understatement of more than $100,000 is considered material. The confirmation
The confirmation responses were received without exception, other than the following items:
a. Evaluate each of the confirmation exceptions to determine whether they represent misstatements.
b. Estimate the total amount of misstatement in the accounts receivable population. Ignore sampling risk in the calculation.
c. Is the population acceptable? If not, indicate what follow-up action(s) you consider appropriate in thecircumstances.
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
Sample Populatior #of Recorded Accounts #of Recorded Accounts Stratum Value Value 8 ,287643 4,348,268 947,682 977 $6,583,593 1 $75,000 $1,287643 1,349,678 2 $10,000-$74,999 3
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a The following summarizes the confirmation responses Total misstatement 56 315 b Estimate of t…View the full answer
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