Big Screen Scripts is a service-type enterprise in the entertainment field, and its manager, William Pippin, has only a limited knowledge of accounting. Pippin prepared the following balance sheet, which, although arranged satisfactorily, contains certain errors with respect to such concepts as the business entity and asset valuation. Pippin owns all of the corporation's outstanding stock. Assets Cash Notes Receivable Accounts Receivable Land Building Office Furniture Other Assets Total BIG SCREEN SCRIPTS Balance Sheet NOVEMBER 30, CURRENT YEAR 5,150 2,700 2,450 Liabilities & Owner's Equity Liabilities: Notes payable Accounts Payable Total liabilities Owners' equity Capital Stock Retained Earnings 70,000 54,320 8,850 22,400 S 165,870 Total S In discussion with Pippin and by inspection of the accounting records, you discover the following facts 67,000 35,805 102.805 S 5,000 58,065 165,870 1. The amount of cash, $5,150, includes $3,400 in the company's bank account, $540 on hand in the company's safe, and $1,210 in Pippin's personal savings account 2. One of the notes receivable in the amount of $500 is an JOU that Pippin received in a poker game several years ago. The IOU is signed by "BK" who Pippin met at the game but has not heard from since 3. Office furniture includes $2,900 for a Persian rug for the office purchased on November 20. The total cost of the rug was $9,400. The business paid $2,900 in cash and issued a note payable to Zoltan Carpet for the balance due ($6,500). As no payment on the note is due until January, this debt is not included in the liabilities given here. 4. Also included in the amount for office furniture is a computer that cost $2.525 but is not on hand because Pippin donated it to a local charity. 5. The "Other Assets" of $22,400 represent the total amount of income taxes Pippin has paid the federal government over a period of years. Pippin believes the income tax law to be unconstitutional, and a friend who attends law school has promised to help Pippin recover the taxes paid as soon as he passes the bar exam. 6. The asset "Land was acquired at a cost of $39,000 but was increased to a valuation of $70,000 when one of Pippin's friends offered to pay that much for it if Pippin would move the building off the lot.

Hi, I have an assignment and I was asked to the audit   Assume you are the senior accountant on an audit engagement of a fictitious business, Pine Street Company (PSC). Assume the instructor is the engagement partner. You are to prepare a audit program for PSC. The firm manufactures and sells bicycles. The audit program must be in one of the following areas of the business: accounts receivable and revenues; inventories and costs of goods sold; accounts payable; payroll; or property, plant and equipment.    Week 2 - Identify the components/sections of a cash audit program for PSC.       Date General Journal  Debit  Credit Merchandise Inventory : $5,900 Account Payable Johns $5,900 Merchandise Inventory $330   Cash $330       Account Payable Johns $900 Merchandise Inventory $900   Account Payable Johns $5,000 Cash  $4,900 Merchandise Inventory  $100   Merchandise Inventory  $ 12,250 Account Payable Johns  $12,250   Account Payable Johns  $3,250 Merchandise Inventory   $3,250   Account…

Which of the following finance options is given to businesses by their suppliers? O Commercial Paper O Trade Credit O Unsecured loan O Corporate bonds What is the value of an independent audit? O t is an independent opinion about the accuracy of financial statements. O It creates an income statement and balance sheet. O it guarantees the company has not committed fraud. O It is not necessary if the company uses GAAP.

Exercise 1: Explain some of the measures taken to reduce the agency conflict problem. Exercise 2: What will be the effect on the balance sheet if a firm buys a new processing plant through a new loan? Exercise 3: According to the text, did Enron and WorldCom follow Generally Accepted Accounting Principles (GAAP) in their financial reporting process? Exercise 4: Briefly discuss the issues in the agency conflict problem.