Take-Home Exam – Marketable Securities & AR/Inventory Management Name: _________________________ Score:____________ I. Selection __________1. A company which foregoes the discount when credit terms are 4/15 net 70 is essentially borrowing money from his supplier for an additional: (A) 40 days (B) 55 days (C) 70 days (D) 85 days. __________2. A company that foregoes a discount of 1/7 net 30 is essentially borrowing money from the vendor at: (A) 1% (B) 12.29% (C) 16% (D) 52.7%. __________3
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Introduction: An internal control system refers to the process by which organizations maintain environments that encourage incorruptibility and deter fraudulent activities by managements and employees. Internal control systems are evaluated during the planning phase of an independent financial statement audit. This is the system is also known as detection and prevention of fraud in an organization. The “Questionnaire Method” is one of various techniques to measure internal control system of any organization
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1‚500 Inventory December 31‚ 2007 (adjusted) $237‚392 (b) Transaction 3 Sales 12‚800 Accounts Receivable 12‚800 (To reverse sale entry in 2007) Transaction 4 Purchases (Inventory) 15‚630 Accounts Payable 15‚630 (To record purchase of merchandise in 2007) Transaction 8 Sales Returns and Allowances 2‚600 Accounts Receivable 2‚600 EXERCISE 8-14 (20–25 minutes) (a) (1) LIFO 600 @ $6.00 = $3‚600 100 @ $6.08 =
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borrowed money from the bank and has deferred payment to Gartner to manage the week of March 24-30 but the outstanding loan and the interest burden have gone up consequently (University of Phoenix‚ 2010). Team C is responsible for working capital management for the company and has come up with an alternate working capital solution and a plan to manage Lawrence ’s cash position in the forthcoming weeks. This paper will discuss the risk and contingencies associated with the alternate working capital
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This could affect demand for some beverages and in turn affect profitability. Water scarcity: Water is the main ingredient of all products. It is a limited resource and also facing unprecedented challenges from overexploitation‚ pollution‚ poor management and climate change in many parts of the world. As water scarcity and demand both increase‚ the system may incur increased production costs or face capacity constraints‚ which could adversely affect profitability. Governmental Regulation: The Company
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nearby the computer called Susan to show the customer’s account‚ and verifying that the payment for the $ 5‚000 was in fact recorded in the customer’s account. On this scenario the person who help to find out what was wrong with the management of the company notice that the payment for $5‚000 for May 10 was entered after May 17 and May 23 and it made her confused. The computer malfunction after that checking made by her and the accounts receivable file was lost and showing a command “file not found”
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CASE DESCRIPTION The primary subject matter of this case concerns receivables management. Secondary issues examined include the impact of a client’s financial distress on a firm’s cashflows; the use financial accounting data to challenge a firm’s going concern principle and the formulation of new business strategies when the unexpected happens to a firm. The case is appropriate for first year graduate level. The case is designed to be taught in two class hours and is expected to require five
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charge as discount charges from the amount of the bill and balance is credited to customer account. Bill of exchange financing is the most liquid one from the banker’s point of view since‚ in time of emergencies‚ they can take those bills those bills to RBI for rediscounting. Even if the bill is dishonored‚ there is a simple remedy. The bank has to simply note and protest the bill and debit the customers account. Bills are always drawn with recourse. Despite many efforts of RBI to promote and develop
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poor account receivable system. The balance amount in the account receivable of the company is not match with the confirmation sent to the customer. These things happen when Mr. Siva‚ one of the retail customers complaining that the figures on the statement of accounts sent to him was incorrect. He had made cash payment and paid all outstanding balance but the transaction was not recorded by Encik Munir‚ one of the former staff at the finance department. It shows that the company’s accounts are not
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Q1: The primary objectives that auditors hope to accomplish by confirming a client’s year-end accounts receivable is to check certain management assertions such as existence‚ rights and obligations‚ and valuation. Confirmations from clients and outside parties related to a transaction. Generally‚ the auditor sends to the client’s customer a confirmation stating the amount owed. The customers are requested to return a statement to the auditor indicating whether they agree with the amount‚ or providing
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