Auditing & Assurance Services: A Systematic Approach (Irwin Accounting)
10th Edition
ISBN: 9780077732509
Author: William F Messier Jr, Steven M. Glover Associate Professor, Douglas F. Prawitt Associate Professor
Publisher: McGraw-Hill Education
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Chapter 14, Problem 14.28P
To determine
Concept Introduction:An analytical procedure is a part of
To identify:Substantive analytical procedures that should utilize in examining mobile construction equipment and related
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Based on the information in scenario C, classify the information (1-8) according to the elements of an audit finding (criteria, condition,cause, effect and recommendations)
For each of the following misstatements in property, plant, andequipment accounts, state an internal control that the client can implement to preventthe misstatement from occurring and a substantive audit procedure that the auditor canuse to discover the misstatement:1. Computer equipment that is abandoned or traded for replacement equipment isnot removed from the accounting records.2. Depreciation expense for manufacturing operations is charged to administrativeexpenses.3. The asset lives used to depreciate equipment are less than reasonable, expected useful lives.4. Capitalizable assets are routinely expensed as repairs and maintenance, perishabletools, or supplies expense.5. Acquisitions of property are recorded at incorrect amounts.6. A loan against existing equipment is not recorded in the accounting records. Thecash receipts from the loan never reached the company because they were used forthe down payment on a piece of equipment now being used as an operating asset. Theequipment…
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Chapter 14 Solutions
Auditing & Assurance Services: A Systematic Approach (Irwin Accounting)
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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- Following are seven audit activities. 1 (Click the icon to view the audit activities.) Requirement For each activity listed above, indicate in which phase of the audit the procedure was likely performed. 1 (Click the icon to view the phases of the audit.) Audit activity Phase а. Examine invoices supporting recorded fixed asset additions. b. Review industry databases to assess the risk of material misstatement in the financial statements. С. Summarize misstatements identified during testing to assess whether the overall financial statements are fairly stated.arrow_forward17. Which of the following best describes the auditors' approach to the audit of the ending balance of property, plant, and equipment for a continuing nonpublic client? Group of answer choices Audit of selected purchases and retirements for the last few years Audit of changes in the accounts since inception of the company Direct audit of the ending balance Agreement of the beginning balance to prior year's working papers and audit of significant changes in the accountsarrow_forwardAlexander Robinson, a junior auditor working for Big One Accounting Firm. He is included in the audit team engaging in the audit the Financial Reports of Complicated Ltd., a listed company on AST. When evaluating audit results for assets in the audit, Alexander has set the preliminary judgment about materiality to be $67,000. He then allocated the materiality to all the asset accounts. The account balances, performance materiality and estimated overstatements in the accounts are shown below: Account Account balance Performance materiality Estimate of total overstatements Cash 60,000 6,000 5,500 Account receivable 1,300,000 20,000 500,000? Inventory 2,100,000 60,000 45,000 Other assets 360,000 24,000 23,000 Total 4,090,000 110,000 Alexander has chosen a sample of $500,000 in Accounts Receivable. He tested it and uncovered $6000 in overstatement. He then checked on the individual accounts and all accounts in the total assets against the allocated performance…arrow_forward
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