
EBK BUSINESS ANALYTICS
3rd Edition
ISBN: 9780135231906
Author: Evans
Publisher: VST
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answer?? General accounting question
Our firm has been the auditor of Caribild Products, a listed company, for a number of years. The
engagement partner has asked you to describe the matters you would consider when planning the audit for
the year ended 31 January 2022.
During your recent visit to the company, you obtained the following information:
(a) The management accounts for the 10 months to 30 November 2021 show a revenue of $260 million and
profit before tax of $8 million. Assume sales and profits accrue evenly throughout the year. In the year
ended 31 January 2021, Caribild Products had sales of $220 million and profit before tax of $16 million.
(b) The company installed a new computerised inventory control system, which has operated from 1 June
2021. As the inventory control system records inventory movements and current inventory quantities, the
company is proposing:
(i) To use the inventory quantities on the computer to value the inventory at the year-end
(ii) Not to carry out an inventory count at the year-end…
Determine the following requirements for these financial accounting question
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