
Auditing and Assurance Services (16th Edition)
16th Edition
ISBN: 9780134065823
Author: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
Publisher: PEARSON
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Chapter 15, Problem 12RQ
To determine
To define acceptable risk of overreliance, computed upper exception rate, estimated population exception rate, sample exception rate and tolerable exception rate
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Jones Manufacturing Co. Ltd. makes a product by way of three consecutive processes.
Inspection takes place during the processing operation, at which point bad units are separated
from good units and sold as scrap at $20 each. Normal losses are estimated to be 5% of input
during the period. The following data relates to process 2 for the month of October. During
October, 20,000 units valued at $400,000 were transferred from process 1 to process 2. Other
costs incurred during the month were:
Direct material added
Direct labour
Production overheads
$272,000
$254,000
$ 120,400
At inspection, 3000 units were rejected as scrap. These units had reached the following degree
of completion:
Transfer from process 1
Direct material added
Conversion costs
100%
80%
50%
Work-in-progress at the end of October was 4,000 units and had reached the following degree
of completion:
Transfer from process 1
Direct material added
100%
60%
40%
Conversion costs
There were no unfinished goods in process 2 at the…
Chapter 15 Solutions
Auditing and Assurance Services (16th Edition)
Ch. 15 - Prob. 1RQCh. 15 - Prob. 2RQCh. 15 - Prob. 3RQCh. 15 - Prob. 4RQCh. 15 - Prob. 5RQCh. 15 - Prob. 6RQCh. 15 - Prob. 7RQCh. 15 - Prob. 8RQCh. 15 - Prob. 9RQCh. 15 - Prob. 10RQ
Ch. 15 - Prob. 11RQCh. 15 - Prob. 12RQCh. 15 - Prob. 13RQCh. 15 - Distinguish between the TER and the CUER. How is...Ch. 15 - Prob. 15RQCh. 15 - Prob. 16RQCh. 15 - Prob. 17RQCh. 15 - Prob. 18RQCh. 15 - Prob. 19RQCh. 15 - Prob. 20RQCh. 15 - Prob. 21RQCh. 15 - Prob. 22.1MCQCh. 15 - Prob. 22.2MCQCh. 15 - Prob. 22.3MCQCh. 15 - Prob. 23.1MCQCh. 15 - Prob. 23.2MCQCh. 15 - Prob. 23.3MCQCh. 15 - Prob. 24.1MCQCh. 15 - Prob. 24.2MCQCh. 15 - Prob. 24.3MCQCh. 15 - Prob. 25.1MCQCh. 15 - Prob. 25.2MCQCh. 15 - Prob. 25.3MCQCh. 15 - Prob. 27DQPCh. 15 - Lenter Supply Company is a medium-sized...Ch. 15 - Prob. 29DQPCh. 15 - Prob. 30DQPCh. 15 - Prob. 31DQPCh. 15 - Prob. 32DQPCh. 15 - Prob. 33DQPCh. 15 - Prob. 34DQPCh. 15 - Prob. 35DQPCh. 15 - Prob. 36CCh. 15 - Prob. 37ICA
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