alance. Commissions are paid to the Sales Representatives that work for the company. They are required to sign a new employment contract every year which detail the terms of their engagement. Normally commissions are paid
Q: During Year 1, Ashkar Company ordered a machine on January 1 at an invoice price of $23,000. On the…
A: Interest on notes = Face value of notes x rate of interest x no. of months/12 = $17000 x 9% x 6/12 =…
Q: A review of the accounting records of Campbell Manufacturing indicated that the company incurred the…
A: Selling expenses Salary of vice president of marketing 15,700 Commission…
Q: Raspberry Co. operates an electric power station, which produces electricity 24 hrs a day, seven…
A: Auditor after conduction of a successful audit lets an organization know its deficiencies based on…
Q: ou are an audit senior of Samyantwi & Partners and are in the process of reviewing the systems…
A: Payroll systems are those systems which manage everything in relation to the procedure of paying the…
Q: McElroy Inc., a marketing consulting firm, entered into the following three revenue contracts in…
A:
Q: The business was started when the company received $48,500 from the issue of common stock.…
A: Prepare an income statement for 2018 as shown below:
Q: Mr X enrolls in a 12-month customer service assistance program for a computer software from CYBER…
A: Revenue recognition principle is based on the accrual concept. It states that when the revenue is…
Q: Jazzy Janitors has found that only 10% of its invoiced amounts are paid in the same month that the…
A: Expected cash receipt and revenue are different. Revenue is the amount of income recognized during…
Q: McElroy Inc., a marketing consulting firm, entered into the following three revenue contracts in…
A: Computation for the Total Transaction Price Particulars Amount ($) Price for Contract A…
Q: An entity has 100 employees, who are each entitled to five (5) working days of paid sick leave for…
A: This question deals with the IAS 16 "Employees benefits" Employees also get benefits other than the…
Q: You are an audit senior of Samyantwi & Partners and are in the process of reviewing the systems…
A: Strengths in Brown’s payroll system area unit as follows: Plant workers are every issued a…
Q: In respect of the payroll system of Khelsea Industries Co, identify and explain SIX Internal Control…
A: Introduction: Payroll expenses: Payroll expenses refer to the expenses that are incurred for the…
Q: A global manufacturing company has over 100 subsidiaries worldwide reporting to it each month. The…
A:
Q: B. KLB plc is one of your audit clients for the previous 8 years. The following information are…
A: Ethical threat: The threat wherein an audit firm is tempted to not follows the ethics of audits. An…
Q: A manufacturing company's payroll register shows the following inofrmation for December: Salary…
A: Journal entries are prepared to record the day-to-day transactions of the business that are of…
Q: Grouse Company is a furniture retailer whose average annual gross receipts for the three preceding…
A: First in First out (FIFO) is one of the inventory valuation methods in which the earliest inventory…
Q: GHI Company established a sales agency in a different location. Upon the establishment of the sales…
A: The net income of the sales agency can be computed by subtracting the agency's expenses from the…
Q: . Identify and explain SIX internal control DEFICIENCIES in Brown Industries Ltd.’s payroll system…
A: Internal control deficiencies : The internal controls for any organization are…
Q: The business was started when the company received $50,000 from the issue of common stock.…
A: The financial statement comprise income statement, balance sheet and cash flows statement that…
Q: You are an audit senior of Samyantwi & Partners and are in the process of reviewing the systems…
A: 1) Brown payroll system deficiencies and controls: Deficiencies : Employees swipe their cards at…
Q: Agency XYZ collected the following income during the month: Income Taxes – Individual, P510,000;…
A: Revenue is the amount that a company earns from normal activities conducted by the business for…
Q: On November 1, 2021, Jonas Company established an agency in Laguna sending its merchandise samples…
A: Net Income of the agency for the month of November 2021 = P12,210 (Option - d)
Q: Three programmers at Feenix Computer Storage, Inc., write an operating systems control manual…
A:
Q: A company separately sells home security equipment and 12 months of system monitoring service for…
A: Revenue: Amount received on sale /service of goods called revenue.
Q: During the fiscal year, Toto began offering a service contract to retail customers entitling them…
A: The adjustment entries are prepared to adjust the revenue and expenses of the current period.
Q: The following selected transactions apply to Topeca Supply for November and December Year 1.…
A: Hi student Since there are multiple subparts, we will answer only first three subparts. If you want…
Q: The following selected transactions apply to topeca supply for november and december year 1.…
A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…
Q: Dawson Co’s computerised wages program is backed up daily, however for a period of 3 months the…
A: SOLUTION AUDIT IS AN OFFICIAL EXAMINATION OF THE PRESENT STATE OF SOMETHING , ESPECIALLY COMPANY'S…
Q: An entity has 100 employees, who are each entitled to five (5) working days of paid sick leave for…
A: The entity expects that 92 employees will take no more than 5 days of paid sick leave in 20x2 and…
Q: Alita Associates is an accounting firm that provides audit and tax services to its clients. Each…
A: A job cost sheet is a list of a project's real costs. The accounting department compiles the report,…
Q: During Year 1, Ashkar Company ordered a machine on January 1 at an invoice price of $23,000. On the…
A: Acquisition cost of the Machine = Invoice price + freight paid + Installation costs
Q: An entity has 100 employees, who are each entitled to five (5) working days of paid sick leave for…
A: This question deals with the IAS 16 "Employees benefits" Employees also get benefits other than the…
Q: Three programmers at Feenix Computer Storage, Inc., write an operating systems control manual for…
A:
Q: The university satellite office operates five days per week with a daily payroll of $5,000.…
A: Accrued Wages Expense on October 31 = No. of days x Wages per day = 3 days x $5000 = $15,000
Q: Payroll Audit Procedures, Computers, and Sampling. You are the senior auditor in charge of the…
A: a. Audit Procedure: A specific procedure undertaken by an auditor to procure evidence in a…
Q: Sun Company, a subsidiary of Guardian, Inc., produces and sells three product lines. The company…
A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: A department store apportions payroll costs to the various departments on the basis of the number of…
A: solution given Total payroll cost 150000 Total accounting cost 70000 Basis of…
Q: management consulting firm has four types of professionals on on its staff: Managing consultants,…
A: Average Average of a number of values is the sum of the multiplication of values and the…
Q: You are an Assistant Audit Manager of Abromovich & Co and are in the process of reviewing the…
A: Introduction: Payroll expenses: Payroll expenses refer to the expenses that are incurred for the…
Q: Shields Company is preparing its interim report for the first quarter ending March 31. The following…
A: The amount that will be reported in the first quarter =( $800000 + $350000 +$260000)/4 = $352500
Q: During Year 1, Ashkar Company ordered a machine on January 1 at an invoice price of $24,000. On the…
A: Depreciation as per straight line method = (Cost - salvage value)/Useful life
Q: During Year 1, Ashkar Company ordered a machine on January 1 at an invoice price of $24,000. On the…
A: The structure of the balance sheet is highlighted by an accounting equation, The double-entry…
Q: During Year 1, Ashkar Company ordered a machine on January 1 at an invoice price of $26,000. On the…
A: Depreciation expense under the straight-line method is calculated by dividing the difference in cost…
Q: a. Identify and explain FIVE internal control STRENGTHS in Brown Industries Ltd.’s payroll system.
A: Auditing is the process of examining the financial statements independently to make sure that the…
Q: A review of the accounting records of Munoz Manufacturing indicated that the company incurred the…
A: Payroll costs include all expenses incurred by an employer in order to reward its personnel.…
Q: KLB plc is one of your audit clients for the previous 8 years. The following information are…
A: Ethical threat: The threat wherein an audit firm is tempted to not follows the ethics of audits. An…
Q: You are an audit senior of Samyantwi & Partners and are in the process of reviewing the systems…
A: Brown Industries Ltd's payroll system control strengths : Strengths in Brown’s payroll system are as…
The audit staff assigned to audit Commission on Sales Expenses totaling $2,000,000 used Analytical
Procedures to audit said balance. Commissions are paid to the Sales Representatives that work for the company.
They are required to sign a new employment contract every year which detail the terms of their engagement.
Normally commissions are paid at a rate of 10% on sales generated by each Sales Representative. Total Sales for
the year amounted to $20,000,000 of which 50% was generated by the Sales Representatives.
Perform a Reasonableness Test on the Commission on Sales Expense balance. Describe all
steps involved and advise what the auditor should do based on the results of the test.
Step by step
Solved in 2 steps
- Walters and Witt, a law firm, is analyzing the profitability of its cases. During the year, the firm represented the Umberg Company in numerous routine legal issues, for which it charged a monthly retainer fee of $2,500. Budget information for the firm follows: Professional labor: Partners $ 500,000 Associates 900,000 Paralegals 600,000 Total $2,000,000 Overhead: Secretarial salaries $ 900,000 Depreciation of office equipment 300,000 Fringe benefits 400,000 Lease expense 200,000 Utilities 300,000 Communication expenses 250,000 Office supplies 150,000 Total $2,500,000 Partner, associates and paralegal hourly salary rates are $100, $60 and $20, respectively. Actual time spent for the Umberg cases follows: Actual Partners 23 hours Associates 42 hours Paralegals 72 hours Walters and Witt…Stingers Inc. provides audited financial statements to its creditors and management receives a bonus partially based on revenues for the year An order for $61,500 was received from one of its regular customer on December 29, for products on hand. This order was shipped f.o.b. shipping point on January 9, 2021. The company made the following entry for 2020: Accounts Receivable 61,500 Sales Revenue 61,500 INSTRUCTIONS - DETERMINE HOW REVENUE SHOULD BE RECORDED UNDER EACH ALTERNATIVE a. Assume the company follows ASPE, provide a GAAP supported-case specific analysis. b. Assume the company follows IFRS, provide a GAAP supported-case specific analysis.Raspberry Co. operates an electric power station, which produces electricity 24 hrs a day, seven days a week. The company’s year-end is 30 June 18. You are an audit manager of Grapefruit & Co, the auditor of Raspberry Co. The interim audit has been completed and you are reviewing the documentation describing Raspberry Co’s payroll system. Systems notes – payroll Raspberry Co employs over 250 people and approximately 70% of the employees work in production at the power station. There are three shifts every day with employees working eight hours each. The production employees are paid weekly in cash. The remaining 30% of employees work at the head office in non-production roles and are paid monthly by bank transfer. The company has anHR department, responsible for setting up all new joiners. Pre-printed forms are completed by HR for all new employees and, once verified, a copy is sent to the payroll department for the employee to be set up for payment. This form includes the staff…
- An accounting firm has 780 hours of staff time and 272 hours of reviewing time available each week. The firm charges $1900 for an audit and $270 for a tax return. Each audit requires 60 hours of staff time and 16 hours of review time. Each tax return requires 10 hours of staff time and 4 hours of review time. What numbers of audits and tax returns will yield an optimal revenue? audits tax returns What is the optimal revenue?B. KLB plc is one of your audit clients for the previous 8 years. The following information are available. The audit team included a manager and two juniors. The client was asking to finish the audit work early this year otherwise they are going to change the auditor next year. One-week bonus was paid to the audit team through their payroll as the client was happy that they finished auditing 5 days earlier than the planned audit time. The audit team got 10% discounts on the client's products. The same discount is normally given to the client's staff. Your firm offered this client a bookkeeping service for this year. To reduce the audit cost, the engagement letter was not updated this year as there is no big changes in the audit tasks from last year. Audit fees are based on a percentage of the net profit before tax. One of the audit team received an offer to be appointed in the client's internal audit department as a head of department. The finance director was recently working as an…Seal Financial Advisors provides accounting and finance assistance to customers in the retail business. Seal has four professionals on staff and an office with six clerical staff. Total compensation, including benefits, for the professional staff runs about $573,000 per year, and normal billable hours are 8,300 hours per year. The professional staff keep detailed time sheets organized by client number. The total office and administrative costs for the year are $755,000. Seal allocates office and administrative costs to clients monthly, using a predetermined overhead allocation rate based on billable hours. What is the predetermined overhead allocation rate that Seal will use for office and administrative costs? (Round your answer to the nearest cent.) A. $69.04 per hour B. $21.93 per hour C. $160.00 per hour D. $90.96 per hour
- KLB plc is one of your audit clients for the previous 8 years. The following information are available: The audit team included a manager and two juniors. The client was asking to finish the audit work early this year otherwise they are going to change the auditor next year. One-week bonus was paid to the audit team through their payroll as the client was happy that they finished auditing 5 days earlier than theplanned audit time. The audit team got 10% discounts on the client’s products. Thesame discount is normally given to the client’s staff. Your firm offered this client a bookkeeping service for this year. To reduce the audit cost, the engagement letter was not updated this year as there is no big changes in the audit tasks from last year. Audit fees are based on a percentage of the net profit before tax. One of the audit team received an offer to be appointed in the client’s internal audit department as a head of department. The finance director was recently working as an…You have recently been appointed as the accountant attached to the head office of the company with the specific responsibility of monitoring the performance of the companies within the group. Each company is treated as an investment center and every month produces an operating statement for the group headquarters. Summaries of the statements for companies A and B which make similar products selling at similar prices for the last month showed a typical situation. Extract from the company monthly operating statements. A B GHS000 GHS000 Sales 600 370 Less variable cost 229 208 Contribution 371 162 Less controllable fixed overheads…Dunne Co. sells equipment service contracts that cover a twoyear period. The sales price of each contract is $600. Dunne's past experience is that, of the total dollars spent for repairs on service contracts, 40% is incurred evenly during the first contract year and 60% evenly during the second contract year. Dunne sold 1,000 contracts evenly throughout the current year. In its December 31 balance sheet, what amount should Dunne report as deferred service contract revenue? Group of answer choices $540,000 $480,000 $360,000 $300,000
- A department store apportions payroll costs to the various departments on the basis of the number of payroll checks issued by each department. Accounting costs are apportioned on the basis of the number of reports generated for each department. The payroll costs for the year were $150,000, and the accounting costs for the year totaled $70,000. The number of payroll checks issued and the number of reports generated for each department are as follows: Number of Number Payroll Checks of Reports Department A 396 60 Department B 1,278 90 Department C 126 150 a. Determine the amount of payroll cost to be apportioned to each department. Рayroll Cost Department A Department B Department C b. Determine the amount of accounting cost to be apportioned to each department. Accounting Cost Department A Department B Department CGinnian and Fitch, a regional accounting firm, performs yearly audits on a number of different for-profit and not-for-profit entities. Two years ago, Luisa Mellina, Ginnians partner in charge of operations, became concerned about the amount of audit time required by not-for-profit entities. As a result, she instituted a series of training programs focusing on the auditing of not-forprofit entities. Now, she would like to see if the training seemed to work. So, she ran a multiple regression on 22 months of data for Ginnian for three variables: the total monthly cost of audit professional time, the number of not-for-profit audits, and the hours of training in the audit of not-for-profit entities. The following printout was obtained: Required: 1. Write out the cost equation for Ginnians audit professional time. 2. If Ginnian expects to have 9 audits of not-for-profits next month and expects that audit professionals will have a total of 130 hours of not-for-profit training, what is the anticipated cost of professional time? 3. Are the hours spent auditing not-for-profit entities positively or negatively correlated with audit professional costs? Is percentage of experienced team members positively or negatively correlated with audit professional cost? 4. What does R2 mean in this equation? Overall, what is your evaluation of the cost equation that was developed for the cost of audit professionals?Elliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of 25,750 and is capable of processing as many as 6,500 purchase orders per year. Each clerk uses a PC and laser printer in processing orders. Time available on each PC system is sufficient to process 6,500 orders per year. The cost of each PC system is 1,100 per year. In addition to the salaries, Elliott spends 27,560 for forms, postage, and other supplies (assuming 26,000 purchase orders are processed). During the year, 25,350 orders were processed. Required: 1. Classify the resources associated with purchasing as (1) flexible or (2) committed. 2. Compute the total activity availability, and break this into activity usage and unused activity. 3. Calculate the total cost of resources supplied (activity cost), and break this into the cost of activity used and the cost of unused activity. 4. (a) Suppose that a large special order will cause an additional 500 purchase orders. What purchasing costs are relevant? By how much will purchasing costs increase if the order is accepted? (b) Suppose that the special order causes 700 additional purchase orders. How will your answer to (a) change?
