Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Question - Paul Ma is responsible for the acquisition and payment cycle of Raleigh Corporation. Inherent risk for accounts payable is high due to the following risk factors: client's bank covenants are tied to the current ratio and management receives bonuses based upon net income. Controls tend to be strong; however, due to some errors in the past, control risk has been set at moderate. Accounts Payable Substantive Tests Ma selected the 100 largest supplier balances from the total of 1000 suppliers recorded in the accounts payable subledger and sent out confirmations. Cash Disbursement Control Tests In testing cash disbursements for Raleigh, Ma performed minimum 25 transactions to determine if the control risk assessment was appropriate. He found the following exception: Five receiving reports were recorded in the acquisitions journal at least two weeks later than their date on the receiving report.
Required -
(a) Based upon the risk factors discussed above (bank covenants and management bonuses) what is the relevant assertion at risk of misstatement for accounts payable? Explain why.
(b) Explain what is wrong with the design of Ma's substantive test for accounts payable.
(c) Provide three substantive audit procedure that would be more effective than selecting and confirming large supplier balances for the audit of accounts payable.
(d) For the exception for the cash disbursement testing, identify which assertion(s) was not met.
(e) Explain the impact (what could go wrong) for the exception (internal control weakness) for Raleigh.
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.
Accounting problems, Draw a detailed timeline incorporating the dividends, calculate the exact Payback Period b) the discounted Payback Period. the IRR, the NPV, the Profitability Index.
Term Structure of Interest Rates
Write a report on Internal Controls
Prepare the bank reconciliation for company.
Create a cost-benefit analysis to evaluate the project
Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR
Distinguish between liquidity and profitability.
Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.
Simple Interest, Compound interest, discount rate, force of interest, AV, PV
CAPM and Venture Capital
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd