Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

Question

Accounting?

Answer 1

Question

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

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Accounting?

Fallon Manufacturing Company measures its activity in terms of machine hours. Last month, the budgeted level of activity was 2,300 machine hours and the actual level of activity was 2,450 machine hours. The cost formula for maintenance expenses is $4.25 per machine hour plus $18,500 per month. The actual maintenance expense was $29,600. Last month, the spending variance for maintenance expenses was _.

Can you solve this financial accounting problem with appropriate steps and explanations?

Answer 2

Question

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

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Answer 3

Question

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

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Answer 4

Question

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

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Answer 5

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

Answer 6

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

Answer 7

Chapter 8, Problem 35DQP

a.

To determine

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

Answer 8

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

Answer 9

b.

To determine

Describe the reason for setting performance materiality of cash at the lowest amount.

Answer 10

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

Answer 11

c.

To determine

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

Answer 12

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

Answer 13

d.

To determine

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

Answer 14

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

Answer 15

e.

To determine

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

Answer 16

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Answer 27

Ch. 8 - Prob. 1RQ Ch. 8 - Prob. 2RQ Ch. 8 - Prob. 3RQ Ch. 8 - Prob. 4RQ Ch. 8 - Prob. 5RQ Ch. 8 - Prob. 7RQ Ch. 8 - Prob. 8RQ Ch. 8 - Prob. 9RQ Ch. 8 - Prob. 10RQ Ch. 8 - Prob. 11RQ

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

Concept explainers

Identify the factors that Person L should consider in setting performance materiality for the asset accounts.

Describe the reason for setting performance materiality of cash at the lowest amount.

Describe the reason why Person L set performance materiality for inventory at a lower amount as compared to accounts receivable, PP&E, and other assets.

Describe the reason why Person L set performance materiality for accounts receivable at the highest amount.

Describe whether setting materiality at a lower level result in collecting more or less audit evidence.

Chapter 8 Solutions