Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Question
Chapter 13, Problem 25QRA
a.
To determine
Explain the given circumstances would CPAs learn of the transactions erroneously treated as revenue expenditures in years 1 and 2.
b.
To determine
Explain whether the
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aya de jesus, cpa, is the continuing auditor of various fabrics, inc. the current year-end is january 31, 20x5. last year's audit report contained an explanatory paragraph because of uncertainty regarding the ability of various fabrics to continue as a going concern. the company had defaulted on two major loan agreemens, and appeared to be losing the race to develop "space age"fabrics. since the date of the last year's audit report, however, company management has changed. significant new prodcuts, which already have proven successful in the markets served by various fabrics, have been developed. creditors have agreed to major debt restructuring agreements, and the company appears to be öut of he woods."
Required
Assuming the company presents comparative financial statements for 20x5 and 20x, present the audit report. remeber, you are updating not reproducing - last year's audit report
While auditing the financial statements of Petty Corporation, the certified publicaccounting firm of Trueblue and Smith discovered that its client’s legal expense accountwas abnormally high. Further investigation of the records indicated the following:Since the beginning of the year, several disbursements totaling $15,000 had been madeto the law firm of Swindle, Fox, and Kreip.Swindle, Fox, and Kreip were not Petty Corporation’s attorneys. A review of thecanceled checks showed that they had been written and approved by Mary Boghas, thecash disbursements clerk. Boghas’s other duties included performing the end-of-monthbank reconciliation.Subsequent investigation revealed that Swindle, Fox, and Kreip are representing MaryBoghas in an unrelated embezzlement case in which she is the defendant. The checkshad been written in payment of her personal legal fees.Requireda. What control procedures could Petty Corporation have employed to prevent thisunauthorized use of cash? Classify each…
Holtz Rubenstein Reminick, CPAs, audited year-end financial statements of Quality Food Brands, Inc., and related companies. Signature Bank, relying upon the audited financial reports prepared by Holtz Rubenstein Reminick, extended a term note to Quality in the principal sum of $10 million. Quality subsequently filed a petition under Chapter 7 of the United States Bankruptcy Code, and Signature Bank only then learned of various false and misleading statements contained in the audited financial reports. Explain whether Signature Bank can recover damages for negligent misrepresentation.
Chapter 13 Solutions
Principles Of Auditing & Other Assurance Services
Ch. 13 - Prob. 1RQCh. 13 - K-J Corporation has current assets of 5 million...Ch. 13 - Prob. 3RQCh. 13 - Prob. 4RQCh. 13 - Explain the use of a system of authorizations for...Ch. 13 - Moultrie Company discovered recently that a number...Ch. 13 - Does a failure to record the retirement of...Ch. 13 - Prob. 8RQCh. 13 - Prob. 9RQCh. 13 - Prob. 10RQ
Ch. 13 - Prob. 11RQCh. 13 - Prob. 12RQCh. 13 - Prob. 13RQCh. 13 - Prob. 14RQCh. 13 - Prob. 15RQCh. 13 - Gibson Manufacturing Company acquired new factory...Ch. 13 - Prob. 17RQCh. 13 - Do the auditors question the service lives adopted...Ch. 13 - Prob. 19RQCh. 13 - Explain how the existence of lease agreements may...Ch. 13 - Prob. 21RQCh. 13 - Prob. 22QRACh. 13 - Prob. 23QRACh. 13 - Gruen Corporation is a large diversified company...Ch. 13 - Prob. 25QRACh. 13 - Prob. 26QRACh. 13 - Prob. 27QRACh. 13 - Prob. 28QRACh. 13 - Prob. 29QRACh. 13 - Prob. 30QRACh. 13 - Prob. 31QRACh. 13 - To assure accountability for fixed-asset...Ch. 13 - Prob. 32BOQCh. 13 - Which of the following is an internal control...Ch. 13 - Which of the following accounts should be reviewed...Ch. 13 - Prob. 32EOQCh. 13 - Prob. 32FOQCh. 13 - Which of the following statements is not typical...Ch. 13 - Prob. 32HOQCh. 13 - Prob. 32IOQCh. 13 - An effective procedure for identifying unrecorded...Ch. 13 - Which of the following is not an overall test of...Ch. 13 - Prob. 32LOQCh. 13 - Prob. 33OQCh. 13 - Analysis of which account is least likely to...Ch. 13 - Prob. 34BOQCh. 13 - Prob. 34COQCh. 13 - Prob. 34DOQCh. 13 - A search for overstated property, plant, and...Ch. 13 - The following are typical questions that might...Ch. 13 - Prob. 36PCh. 13 - Prob. 37PCh. 13 - Chem-Lite, Inc., maintains its accounts on the...Ch. 13 - Prob. 39PCh. 13 - You are reviewing the property, plant, and...
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