AUDITING LL W/ CONNECT <C>
11th Edition
ISBN: 9781307416268
Author: MESSIER
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 14, Problem 14.26P
A
To determine
Introduction: The assets category in the
To describe: The general characteristics of assets that should normally be classified as “Property, plant and equipment”. The assertions that are used to examine “Property, plant and equipment”.
B
To determine
Introduction: The assets category in the balance sheet comprises of current assets, property, plant and equipment, etc. Property, plant and equipment is also referred to as plant assets which are long term assets as such assets are expected to last for more than a year. Plant assets are tangible assets which can be seen and touched and help the business in utilizing the other available resources.
To explain: The items mentioned in the question need reclassification or not.
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You are required to obtain the annual reports of two ASX Top 200 companies in the sameindustry and write a business research report to address the following questions related to theitems included in property, plant and equipment.1. Review and evaluate the PPE disclosure of your selected companies which may include:• What range of measures is used to determine amounts for these items in the reports ofthe individual companies?• Do you think it is valid to add the items, given the measures used?• How would you interpret the total amount for property, plant and equipment in thefinancial statements?• Compare the measures used by the different companies for similar items. Are there anyinconsistencies in how similar items are measured by the different companies?2. Discuss the factors that accountants should consider when setting up company accountingpolicy relating to PPE.3. Detail your view on the subsequent measurement of PPE and provide recommendations toaccounting standard setters.
1. What is the total depreciation expense on office equipment for 2021?
2.What is the total depreciation expense on office buildings for 2021?
2.What is the total depreciation expense on factory buildings for 2021?
As the recently appointed auditor for Sandhill Corporation, you have been asked to examine selected accounts before the six-month
financial statements of June 30, 2023, are prepared. The controller for Sandhill mentions that only one account is kept for intangible
assets. The entries in Intangible Assets since January 1, 2023, are as follows:
INTANGIBLE ASSETS
4
5
11
30
30
Research costs
Legal costs to obtain patent
Payment of seven months' rent on property leased by Sandhill (February to August)
Proceeds from issue of common shares
Promotional expenses related to start-up of business
Development stage costs (meet all six development stage criteria)
Start-up costs for first six months of operations
Account Titles and Explanation
Debit
Debit
1,043,600
57,000
50,400
159,000
222,000
314,000
Credit
Credit
309,800
Balance
1,043,600
1,100,600
1,151,000
841,200
1,000,200
Prepare the journal entry or entries needed to correct this account. Allocate rent between the prepaid and expense accounts…
Chapter 14 Solutions
AUDITING LL W/ CONNECT <C>
Ch. 14 - Prob. 14.1RQCh. 14 - Prob. 14.2RQCh. 14 - Prob. 14.3RQCh. 14 - Prob. 14.4RQCh. 14 - Prob. 14.5RQCh. 14 - Prob. 14.6RQCh. 14 - Prob. 14.7RQCh. 14 - Prob. 14.8RQCh. 14 - Prob. 14.9RQCh. 14 - Prob. 14.10RQ
Ch. 14 - Prob. 14.11RQCh. 14 - Prob. 14.12MCQCh. 14 - Prob. 14.13MCQCh. 14 - Prob. 14.14MCQCh. 14 - Prob. 14.15MCQCh. 14 - Prob. 14.16MCQCh. 14 - Prob. 14.17MCQCh. 14 - Prob. 14.18MCQCh. 14 - Prob. 14.19MCQCh. 14 - Prob. 14.20MCQCh. 14 - Prob. 14.21MCQCh. 14 - Prob. 14.22MCQCh. 14 - Prob. 14.23PCh. 14 - Prob. 14.24PCh. 14 - Prob. 14.25PCh. 14 - Prob. 14.26PCh. 14 - Prob. 14.27PCh. 14 - Prob. 14.28P
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