Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd Logo
Upload

Welcome to Scribd!

  • 36 views

    Practice

    Uploaded by

    Nana Cat
    WE NEVER KNOW Incorporated provided Marky, CPA, with their unadjusted trial balance as of December 31, 2017. The trial balance includes assets such as cash, accounts receivable, inventory, and property and equipment. It also includes liabilities like accounts payable, notes payable, bonds payable, and equity accounts such as share capital and retained earnings. Marky is conducting an audit of the company's financial statements and has encountered four situations that could impact the type of audit opinion issued.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Practice

    Uploaded by

    Nana Cat
    36 views1 page
    WE NEVER KNOW Incorporated provided Marky, CPA, with their unadjusted trial balance as of December 31, 2017. The trial balance includes assets such as cash, accounts receivable, inventory, and property and equipment. It also includes liabilities like accounts payable, notes payable, bonds payable, and equity accounts such as share capital and retained earnings. Marky is conducting an audit of the company's financial statements and has encountered four situations that could impact the type of audit opinion issued.

    Original Description:

    notes

    Original Title

    practice docx

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    WE NEVER KNOW Incorporated provided Marky, CPA, with their unadjusted trial balance as of December 31, 2017. The trial balance includes assets such as cash, accounts receivable, inventory, and property and equipment. It also includes liabilities like accounts payable, notes payable, bonds payable, and equity accounts such as share capital and retained earnings. Marky is conducting an audit of the company's financial statements and has encountered four situations that could impact the type of audit opinion issued.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    36 views1 page

    Practice

    Uploaded by

    Nana Cat
    WE NEVER KNOW Incorporated provided Marky, CPA, with their unadjusted trial balance as of December 31, 2017. The trial balance includes assets such as cash, accounts receivable, inventory, and property and equipment. It also includes liabilities like accounts payable, notes payable, bonds payable, and equity accounts such as share capital and retained earnings. Marky is conducting an audit of the company's financial statements and has encountered four situations that could impact the type of audit opinion issued.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    ACP314

    WE NEVER KNOW Incorporated


    UNADJUSTED TRIAL BALANCE
    December 31, 2017

    Debit Credit
    Petty cash fund P 60,000
    Cash in bank 1,056,000
    Trading securities 483,640
    Accounts receivable – trade 3,618,660
    Allowance for doubtful accounts P 110,360
    Notes receivable 1,300,000
    Inventories 7,274,900
    Prepaid advertising 640,000
    Prepaid insurance 490,000
    Prepaid rent 420,000
    Office supplies inventory 361,000
    Furniture and fixtures 1,298,400
    Delivery equipment 2,770,000
    Accumulated depreciation 1,177,500
    Other assets 548,000
    Accounts payable – trade 2,356,320
    Notes payable 3,300,000
    Accrued expenses 169,040
    Bonds payable 5,000,000
    Discount on bonds payable 500,000
    Ordinary share capital 5,400,000
    Retained earnings 792,160
    Sales 13,078,000
    Cost of goods sold 8,034,000
    Operating expenses 3,357,000
    Other income 1,453,500
    Other charges 625,280

    P32,836,880 P32,836,880

    Below are situations that Marky, CPA, has encountered during his audit of WE NEVER KNOW Incorporated.

    Assume
     The auditor is independent
     The auditor previously expressed an unqualified opinion on the prior year’s financial statements.
     Only single-year (not comparative) statements are presented for the current year.
     The conditions for an unqualified opinion exist unless contradicted by the facts.
     The conditions stated in the items to be answered are material, unless otherwise indicated.

    1. WE NEVER KNOW changed its method of accounting for the cost of inventories from FIFO to LIFO.
    Marky concurs with the change although it has a material effect on the comparability of the financial
    statements.

    2. Marky was engaged to audit a client’s financial statements after the annual physical inventory count. The
    accounting records were not sufficiently reliable to enable him to become satisfied as to the year-end
    inventory balances.

    3. Marky found an immaterial adjustment relating to inventory. WE NEVER KNOW has refused to adjust
    the financial statements to reflect this immaterial item.

    4. Due to losses and adverse key financial ratios, Marky has substantial doubt about WE NEVER KNOW’
    ability to continue as a going concern for a reasonable period of time. The client has adequately disclosed
    its financial difficulties in a note to its financial statements, which do not include any adjustments that
    might result from the outcome of this uncertainty. Also, Marky has ruled out the use of a disclaimer of
    opinion.

    You might also like