Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 1, Problem 36DQ
To determine
Comment on the given statements with respect to the IRS
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Which of the following types of audit evidence provides the least assurance of reliability?
A. Receivable confirmations received from the client's customers
B. prenumbered receiving reports completed by the client's employees
C. Prior months' bank statements obtained from the client
D. Municipal property tax bills prepared in the client's name.
Which of the following procedures is MOST likely to be performed before the balance sheet date?
a.
Determine the date of the Letter of Representations
b.
Make a legal determination whether fraud has occurred.
c.
Search for unrecorded liabilities.
d.
Confirmation of receivables.
e.
Updating the predecessor's audit report date.
Which of the following procedures would a CPA most likely perform in planning a financial statement audit?a. Make inquiries of the client’s lawyer concerning pending litigation.b. Perform cutoff tests of cash receipts and disbursements.c. Compare financial information with nonfinancial operating data.d. Recalculate the prior-years’ accruals and deferrals.
Chapter 1 Solutions
Individual Income Taxes
Ch. 1 - Prob. 1DQCh. 1 - Prob. 2DQCh. 1 - The Sixteenth Amendment to the U.S. Constitution...Ch. 1 - Prob. 4DQCh. 1 - How does the pay-as-you-go procedure apply to wage...Ch. 1 - Jane, a tax practitioner, has reviewed the law on...Ch. 1 - Prob. 7DQCh. 1 - Prob. 8DQCh. 1 - Prob. 9DQCh. 1 - Prob. 10DQ
Ch. 1 - Sophia lives several blocks from her parents in...Ch. 1 - Prob. 12DQCh. 1 - Prob. 13DQCh. 1 - Prob. 14DQCh. 1 - Prob. 15DQCh. 1 - Prob. 16DQCh. 1 - Prob. 17DQCh. 1 - Prob. 18DQCh. 1 - Prob. 19DQCh. 1 - Prob. 20DQCh. 1 - Elijah and Anastasia are husband and wife who have...Ch. 1 - What is the difference between the Federal income...Ch. 1 - As to those states that impose an income tax,...Ch. 1 - Prob. 24DQCh. 1 - Prob. 25DQCh. 1 - Prob. 26DQCh. 1 - Prob. 27DQCh. 1 - Prob. 28DQCh. 1 - Contrast FICA and FUTA as to the following: a....Ch. 1 - Prob. 30DQCh. 1 - Prob. 31DQCh. 1 - Prob. 32DQCh. 1 - Prob. 33DQCh. 1 - Prob. 34DQCh. 1 - Serena operates a gift shop. To reduce costs of...Ch. 1 - Prob. 36DQCh. 1 - Prob. 37DQCh. 1 - Prob. 38DQCh. 1 - Prob. 39DQCh. 1 - Prob. 40DQCh. 1 - Prob. 41DQCh. 1 - Prob. 42DQCh. 1 - Prob. 43DQCh. 1 - Prob. 44DQCh. 1 - Prob. 45DQCh. 1 - In terms of tax policy, what do the following...Ch. 1 - Prob. 47DQCh. 1 - Prob. 48DQCh. 1 - Prob. 49DQCh. 1 - Prob. 50DQCh. 1 - Using information from this chapter as well as...Ch. 1 - Prob. 3RPCh. 1 - Prob. 4RP
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- STATEMENT 1: Most of the information included in the permanent file are accumulated during the initial audit. STATEMENT 2: The auditor may at his/her discretion make some information from the audit working papers available to clients. A. Only Statement 1 is incorrect B. Only Statement 1 is correct C. Both statements are incorrect D. Both statements are correctarrow_forwardWhat are the primary types of tax audits conducted by taxing authorities? a) Random audits and targeted audits b) Field audits and desk audits c) Pre - filing audits and post - filing audits d) Internal audits and external auditsarrow_forwardPlease help mearrow_forward
- You are involved with the audit of Jelco Company for year 1 and have been asked to consider the confirmation reply results indicated below. For each confirmation reply, select the proper action to be taken from the following possible actions: (Each of the "Action" items may be used once, more than once, or not at all.) (1)Exception; propose an adjustment. (2)Send a second confirmation request to the customer. (3) Examine shipping documents and/or subsequent cash receipts. (4)Verify whether the additional invoices noted on the confirmation reply pertain to the year under audit or the subsequent year. (5) Not an exception; no further audit work is necessary. Proper Action Customer Reply (and any audit action already taken) a. "We mailed the check for this on December 31." "We returned those goods on December 2." You have been able to determine that the goods were received by the client on December 29, but not recorded until January 2. c. "We also owe for two more invoices for purchases…arrow_forwardThe audit report dates are:a. Closing date of client's bookb. The date on which the letter of representation was receivedc. The date when the audit report is submitted to the clientd. The date on which all the necessary audit procedures were performedarrow_forwardIs it allowed to send copies of the auditor's earlier paperwork to the client? If yes, are there any special criteria that auditors should review prior to delivering the client's documentation? At least three things should be mentioned.arrow_forward
- Indicate which of the following statements are true or false: ________The IRS is a division of the Treasury Department. ________The IRS has four major divisions. ________The IRS local offices process most individual tax returns. ________IRS Campus Processing Sites are the locations that taxpayers should call to obtain tax information. ________Taxpayers should have their CPAs keep their tax records to prevent the IRS from being able to summon their records. ________Most IRS audits are conducted through the mail.arrow_forwardThe following are included in the audit working paper current file. *A. Chart of accounts, audit program, working trial balanceB. Organizational chart, engagement letter, adjustmentsC. Lawyer’s letter, audit program, lead scheduleD. Lead schedule, bank confirmation replies, by-lawsE. None of themarrow_forwardWhich of the following types of documentary evidence should the auditor consider the most reliable?a. Sales invoice created by the client with the support of proof of delivery from an outside delivery serviceb. Confirmation of debt balances sent and returned directly to the auditorc. Check made by the company and includes a sign of approval of the party receiving the money, which is included in the bank statement sent directly to the auditord. An audit list prepared by the client controller and reviewed by the client treasurer.arrow_forward
- Providing copies of the auditor's earlier paperwork to the customer is permitted under the circumstances. If so, are there any particular circumstances that the auditors should look for before delivering the client's documentation? List at least three things that come to mind.arrow_forwardWhich non-audit service may be provided to an SEC audit client? A- )Preparing the annual tax returns for review and approval by the client. B- )Designing the future state operating model for its finance and accounting functions. C- )Performing a valuation to support the client’s legal claim. D- )Developing, managing and executing portions of its internal audit plan.arrow_forwardWhich of the following is the most common type of audit for an individual taxpayer? Oa. Correspondence audit Ob. Telephone audit Oc. Field audit Od. Office audit Oe. None of these choices are correct.arrow_forward
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