User Account

All Pages

Discuss the potential impact on the financial statement

Assignment Help Accounting Basics
Reference no: EM132678182

The audit team completed the field work on 22 July 2020. The audit report was signed on 5 August by Charles Kirby. The financial statements were signed by the BoD on the same day, which was subsequently released to shareholders on 12 August 2020.

During the review of subsequent events, you noted the following material events:

  • Cook's Furniture Ltd has purchased a property in Adelaide Australia on 20 July 2020 for AUD 3,200,000 and intended to use it as a showroom. The company borrowed AUD 2,000,000 to finance the purchase. The company plans to take the opportunity of the current low interest rate to expand its property acquisitions.
  • The company applied for Wages Subsidy scheme on 4 April and was granted 70,000. On 7 August, the BoD received a letter from the government requesting the company to pay back the Wages Subsidy with interests citing the reason that the company did not qualify.
  • The company was experiencing delays in its supply chain from overseas suppliers from March to May 2020, which resulted longer lead times in filling customer orders. On 31 July, a customer filed a lawsuit against the company suing for damages of $300, 000. Because of the delay, this customer could not open business on time and suffered income loss.

REQUIRED: For each of the above subsequent event:

Problem a) Explain the potential impact on the 2020 financial statements.

Problem b) Discuss audit procedures that may verify the potential impact on the 2020 financial statements.

Reference no: EM132678182

Questions Cloud

In what way may lynn schoreder illustration good spending : In what way does May Lynn Schoreder illustration good spending and cost-cutting habits? The response must be typed, double spaced.
Analyze writer potential issues related to sustainability : Analyze the writer's potential issues related to sustainability. Does the writer use professional health care terminology appropriately and correctly?
What you have learned as you created your project : Provide a reflection on what you have learned as you created your project. What would you have done differently? What worked well, and what did not? 300 words.
What professional guidelines your change initiative impact : What professional guidelines or accreditation does your change initiative impact? Were you able to see this early on in your project or did you not realize.
Discuss the potential impact on the financial statement : Discuss audit procedures that may verify the potential impact on the 2020 financial statements. Explain the potential impact on the 2020 financial statements.
Make closing entries using income summary account for dec : prepared their adjusted trial balance. Using the adjusted trial balance, prepare the closing entries using the income summary account for the month of December.
Make the closing entries using the income summary account : Make the closing entries using the income summary account for the month of September and create the post-closing trial balance.
Describe the three types of supervisory styles : Develop a 5-6 page paper (using APA style) that describes 3 types of supervisory styles. Use at least 4-5 references to substantiate the research styles.
Prepare the closing entries using the income summary : Frank's Custom, Using the adjusted trial balance, prepare the closing entries using the income summary account for the month of December.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare a process cost report using weighted average method

Units completed and transferred out during March 88,000 units. Prepare a process cost report using the weighted average method

  What is the closing entries

During the year ended June 30, 2012, the following transactions were recorded by St. Ann's College, a private institution.

  Underlying rationale for the alimony rules

The underlying rationale for the alimony rules is that: 1. The fruit and tree metaphor should be rigorously applied.

  Prepare the journal entries for Ayayai on March

On March 1, 2020, Ayayai Company sold goods to Goosen Inc. for $714,000 in exchange for a 5-year, Prepare the journal entries for Ayayai on March

  Compute the equivalent units of production for october

Compute the equivalent units of production for October assuming that the company uses the FIFO method of accounting for units and costs

  Differentiate between a loss carryback and loss carryforward

Differentiate between a loss carryback and loss carryforward. Explain the way in which carrybacks and carryforwards affect the reporting of deferred tax assets and deferred tax liabilities. Provide one (1) example, situation, or scenario of thi..

  Maxson products distributes a single product a woven basket

compute the break-even point lo6 maxson products distributes a single product a woven basket whose selling price is

  Determine the compensation expense for the stock option plan

When is Ensor's stock option measurement date? Determine the compensation expense for the stock option plan in 2016.

  Journalize transactions using a perpetual inventory system

Crane Hardware Store completed the following merchandising transactions in the month of May. Journalize transactions using a perpetual inventory system

  Examine at least four accounting regulatory bodies and

examine at least four accounting regulatory bodies and discuss how an organization complies with the standards of the

  Journal entries to record transactions in general fund

(Encumbrance journal entries) A village ordered supplies for its Fire Department at an estimated cost of $16,700.

  Determine the development of personal financial goals

Determine Development of personal financial goals through the application of modern finance. Development of the tools necessary to assess risk

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd