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Show the relationship of cash in the bank to the various transaction cycles. Design and perform audit tests of the general cash account.

Posted on February 19, 2023 by Assessments

AUDIT OF CASH AND FINANCIAL INSTRUMENTS Identify the major types of cash and financial instruments accounts maintained bybusiness entities.Show the relationship of cash in the bank to the various transaction cycles.Design and perform audit tests of the general cash account.Recognize when to extend audit tests of the general cash account to testfurther for material fraud.Design […]

What is the minimum bid price and number of shareholders under the standards and liquidity requirements?

Posted on February 19, 2023 by Assessments

Before a company can begin trading on an exchange, it must meet certain initial requirements. The exchanges set their own standards for initial listing, which include minimum thresholds for the number of publicly traded shares, total market value, stock price, and number of shareholders. a. Review the NASDAQ listing requirements and describe the three distinct […]

How should the amounts shown as of September 30, 2017, relate to the amounts shown in Apple’s balance sheet as of the same date?

Posted on February 19, 2023 by Assessments

The table below is an excerpt from Apple Inc.’s Statement of Shareholders’ Equity for its fiscal year ended September 30, 2017: CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Common Stock and Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income/(Loss) Total Shareholders’ EquityShares Amount Balance as of September 24, 2016 5,336,166 $31,251 $96,364 $634 $128,249 Net income […]

List the type of misstatements the auditors can uncover by the use of each audit procedure.

Posted on February 19, 2023 by Assessments

The following audit procedures are commonly performed by auditors in the verification of owners’ equity: 1. Review articles of incorporation and bylaws for provisions about owners’ equity. 2. Analyze all owners’ equity accounts for the year and document the nature of any recorded change in each account. 3. Confirm capital stock transactions with the stock […]

Are financial statement footnotes reviewed for completeness of required disclosures related to owners’ equity?

Posted on February 19, 2023 by Assessments

Items 1 through 6 are common questions found in internal control questionnaires used by auditors to obtain an understanding of internal control for owners’ equity. In using the questionnaire for a client, a “yes” response indicates a possible internal control, whereas a “no” indicates a potential deficiency. 1. Are all entries in the owners’ equity […]

Identify the types of information that should be disclosed in the footnotes for this long-term note payable to help the auditor determine whether the presentation audit objective is satisfied.

Posted on February 19, 2023 by Assessments

The Redford Corporation took out a 20-year mortgage on June 15, 2019, for $2,600,000 and pledged its only manufacturing building and the land on which the building stands as collateral. Each month subsequent to the issue of the mortgage, a payment of $17,885 was paid to the mortgagor. You are in charge of the current […]

List any audit steps or reporting requirements you think should be taken or recognized in connection with each one of the following:A sinking fund shall be deposited with the trustee by semiannual payments of $400,000, from which the trustee shall, in his or her discretion, purchase bonds of this issue.

Posted on February 19, 2023 by Assessments

The following covenants are extracted from the indenture of a bond issue. The indenture provides that failure to comply with its terms in any respect automatically makes the loan immediately due . List any audit steps or reporting requirements you think should be taken or recognized in connection with each one of the following: a. […]

What should be the emphasis in the verification of notes payable in this situation? Explain.

Posted on February 19, 2023 by Assessments

The ending general ledger balance of $568,000 in notes payable for the Kolman Production Company is made up of 20 notes to nine different payees. The notes vary in duration anywhere from 30 days to two years, and in amounts from $10,000 to $50,000. In some cases, the notes were issued for cash loans; in […]

How might you use the information presented above to audit interest expense and interest payable accounts?

Posted on February 19, 2023 by Assessments

Your client, EKB, Inc., prepared the following schedule for long-term debt for the audit of financial statements for the year ended December 31, 2019: Notes Payable Description Interest Rate Due Date 1/1/19 Beginning Balance Additions Payments 12/31/19 Ending Balance Mortgage Payable 6.25% 2025 $ 1,125,000 – $ 200,000 $ 925,000 Unsecured Notes Payable 6.00% 2027 […]

Explain how the auditor should verify the unamortized bond discount or premium.

Posted on February 19, 2023 by Assessments

The following are frequently performed audit procedures for the verification of bonds payable issued in previous years: 1. Analyze the general ledger account for bonds payable, interest expense, and unamor- tized bond discount or premium. 2. Obtain a confirmation from the bondholder. 3. Obtain a copy of the bond indenture agreement and review its important […]