Audit report modifications | Accounting homework help

Audit Report Modifications

The final paper will be based on Appendix 6C Illustrative Audit Case: Keystone Computers at pages 237-244 in your text. Write, in outline format but in complete sentences, a 6 to 10 page audit plan. It is recommended that you look at Figure 18.8 on page 708, which shows the control objectives related to accounts receivable. (Both Appendix/Figure are attached)

In your audit plan cover the steps necessary to determine if you should select the client, the internal control procedures which need to be reviewed, the substantive tests [using accounts receivable a guide], and the final reporting steps. Based on the actual facts in the case determine the emphasis you want to place on various accounts. Also reflect back over your entire accounting program and think about how the accounts are interrelated. For example, when allowance for doubtful accounts is credited the offset is to bad debt expense. Therefore one of the steps should be to trace the debit side of the entry to the balance for bad debt expense.

Make your comments as specific as possible. Rather than say look for unusual entries, say look for entries from unusual sources and rounded amounts with focus on those near an accounting cut off. Use precise language. Rather than saying you “vouched accounts payable,” say that you looked at the item to determine that it was a bona fide business expense. Remember to focus on the key audit objectives and support needed after applying the audit risk model.

Remember, the purpose of the Final Paper is for you to culminate the learning achieved in the course by describing your understanding and application of knowledge in the field of accounting.

The Final Paper should focus on real life, real time application of topics covered in this course; the uses you have seen and the uses you can envision. The paper must be submitted to your instructor no later than the last day of class. Earlier submittal is appreciated.

Writing the Final Paper

The Final Paper:

Must be six to ten double-spaced pages in length, and formatted according to APA style as outlined in the Ashford Writing Center.
Must include a title page with the following:

Title of paper
Student’s name
Course name and number
Instructor’s name
Date submitted

Must begin with an introductory paragraph that has a succinct thesis statement.
Must address the topic of the paper with critical thought.
Must end with a conclusion that reaffirms your thesis.
Must use at least three scholarly sources, including a minimum of one from the Ashford Online Library.
Must document all sources in APA style, as outlined in the Ashford Writing Center.
Must include a separate reference page, formatted according to APA style as outlined in the Ashford Writing Center.

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July 1, 2023

51. Rounding is often necessary to make the Production Report cumulative cost total agree to the total costs accounted for. In the following periods, the amount of the adjustment is either added to or subtracted from the _____________ in work in process.

A. direct materials

B. direct labor

C. manufacturing overhead

D. credit entry

52. A firm had a beginning work in process inventory totaling $4,000 and current period costs of $22,500. Equivalent production was 5,000 units, and 3,000 units were completed and transferred to the finished goods inventory. Inventory costs would be determined using a unit cost of

A. $8.83.

B. $5.30.

C. $4.50.

D. $7.50.

53. Simon Productions Company had a beginning work in process inventory totaling $6,000. During the current period, the company added materials costs of $12,300, labor cost of $14,500 and overhead of $18,200. Equivalent production was 12,000 units, and 9,000 units were completed and transferred to the finished goods inventory. Inventory costs would be determined using a unit cost of

A. $5.67.

B. $3.75.

C. $4.25.

D. $8.50.

54. The source of the cost data that appears in a cost of production report is

A. the Finished Goods Inventory account.

B. the job order cost sheet.

C. the prior period income statement.

D. the Work in Process Inventory accounts.

55. In a process cost accounting system,

A. the Finished Goods Inventory account is debited for the cost of completed units any time during the month.

B. the Work in Process Inventory accounts are used to accumulate the costs for labor, materials, and manufacturing overhead.

C. manufacturing overhead is not included in the determination of inventory costs.

D. inventory costs are calculated when goods are sold.

56. The entry to transfer costs from Department A to Department B is recorded as

A. a debit to Finished Goods Inventory and a credit to Work in Process—Dept. A.

B. a debit to Work in Process—Dept. B and a credit to Work in Process—Dept. A.

C. a debit to Work in Process—Dept. A and a credit to Work in Process—Dept. B.

D. a debit to Work in Process—Dept. A and a credit to Finished Goods Inventory.

57. When finished goods are sold, the entry to record the cost of goods sold includes

A. a debit to Finished Goods Inventory and a credit to Cost of Goods Sold.

B. a debit to Cost of Goods Sold and a credit to Sales.

C. a debit to Cost of Goods Sold and a credit to Finished Goods Inventory.

D. a debit to Finished Goods Inventory and a credit to Sales.

58. At the end of the month, the entry to close the Manufacturing Overhead control account is recorded as

A. a debit to Manufacturing Overhead Applied and a credit to Manufacturing Overhead.

B. a debit to Work in Process Inventory accounts and a credit to Manufacturing Overhead.

C. a debit to Manufacturing Overhead and a credit to the Work in Process inventory accounts.

D. a debit to Manufacturing Overhead and a credit to Manufacturing Summary.

59. In a process cost accounting system, the average unit cost of a product is determined by dividing the appropriate costs by

A. the number of units placed in production during the period.

B. the number of units transferred to another department.

C. the equivalent production units.

D. the number of units transferred to the finished goods inventory.

60. On a cost of production report, beginning work in process

A. is included in the quantity to be accounted for.

B. is included in the quantity accounted for.

C. is not included on the report.

D. appears on the job cost sheet only.

61. The current department costs categories are

A. work in process—beginning costs, started in production costs, and transferred in costs.

B. materials costs, labor costs, and manufacturing overhead costs.

C. work in process—beginning costs, transferred out to next department costs, and work in process—ending costs.

D. started in production costs, transferred in from prior department costs, and transferred out to next department costs.

62. When beginning inventory is part of the production report, costs from the prior department are included. They are

A. the beginning inventory amount and the costs transferred in.

B. the beginning inventory amount.

C. the costs transferred in.

D. the beginning inventory costs transferred in.

63. The method that combines the cost of beginning inventory and the current costs of the period is the

A. market value process costing method.

B. method of net realizable value.

C. replacement cost method.

D. average method of process costing.