456 Chapter Eleven Appendix 11B Illustrative Audit Case: Keystone Computers & Networks‚ Inc. Part III: Substantive Tests—Accounts Receivable and Revenue This part of the audit case illustrates the manner in which the auditors design substantive tests of balances. The substantive tests are illustrated for two accounts—receivables and revenue. This aspect of the audit is illustrated with the following audit documentation: • ABC’s risk assessment working paper that combines the auditors’ assessments
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controller should know her duties and responsibility. Company need to send Ms Choy for training. The training we recommend for Ms Choy to attend is Credit Management and Debt Recovery course being organised by Mr. Tam Fook Cheong is a fellow member of the Charted Association of Certified Accountant (FCCA)‚ Associate Member of the Chartered Institute of Management Accountant (ACMA) and a Chartered Accountant of the Malaysian Institute of Accountant (CA). The objective of the course is to establish effective
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occurrence Audit Objectives: Substantiate the existence of receivables and the occurrence of revenue transactions. Prove none of the account receivables are fictitious. Completeness Audit objectives: Establish the completeness of receivables and revenue transactions. Rights and obligations Audit objectives: Determine the client has rights to the recorded receivables. Prove the accounts receivable are collectible in the normal course of business and
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steps would reduce its cash conversion cycle? a. The company increases its average inventory without increasing its sales. b. The company reduces its DSO. c. The company starts paying its bills sooner‚ which reduces its average accounts payable without reducing its sales. d. Statements a and b are correct. e. All of the statements above are correct. Cash budget Answer: e Diff: E [iv]. Which of the following is typically part of the cash budget? a. Payments
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of _ accounts receivable _______ for the company. Q 8.36: Which of the following is true of accounts receivable and notes receivable? Both accounts receivable and notes receivable represent claims that a company expects to receive in cash. Q 8.37: Notes receivable are written promises that are considered formal instruments of credit Q 8.38: Another name for trade receivables‚ which result from sales transactions‚ is accounts receivable Q 8.39: Trade receivables are accounts receivable that
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principles (GAAP)‚ each manager makes different choices and estimates when applying GAAP. By preparing the financial statements‚ calculating ratios‚ and comparing and contrasting the two companies‚ students see how choices and estimates made by management affect the financial statements. They also see the challenge faced by users of financial information when trying to interpret the financial statements and compare companies. Students really experience an ‘‘aha!’’ moment while analyzing this case
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“Liquidity and Profitability: An Empirical Analysis of Cement Industry of Pakistan” BY: ADNAN AHMED ACKNOWLEDGEMENT All prays to Allah Almighty who is the most beneficiate and the most merciful who is master of the day of “Decisions” and million times “Droods” and “Salams” to the Holy Prophet (PBUH) whose life is role model for us and for all. I am very thankful to my teachers‚ I under their kind control and guidance learnt a lot. May Allah bless them with success! ADNAN AHMED
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scorecard‚ use only performance measures listed previously. You do not have to use all of the performance measures suggested by the managers‚ but you should build a balanced scorecard that reveals a strategy for dealing with the problems with accounts receivable and with unsold merchandise. Construct the balanced scorecard following the format used in Exhibit 12—8. Do not be concerned with whether a specific performance measure falls within the learning and growth‚ internal business process‚ customer
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Case Study - “Jones Electrical” 2. – Why this profitable company needs a bank loan? As we can see from the figures and the information given in the present case‚ the company is very profitable due to the ambition and well management done by its owner Mr. Jones. In this regard‚ we can see in “Table 2 in the spreadsheet”‚ that the company is taking advantage of the 2% discount offered by suppliers saving around $75‚000.00 per year. We have to pay especial attention to the agreement reached with
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Integrative Case 7‚ Casa de Diseno‚ involves evaluating working capital management of a furniture manufacturer. Operating cycle‚ cash conversion cycle‚ and negotiated financing needed are determined and compared with industry practices. The student then analyzes the impact of changing the firm’s credit terms to evaluate its management of accounts receivable before making a recommendation. a. Operating cycle (OC) average age of inventory average collection period 110 days 75 days
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