Questions from Auditing and Assurance

Q: McMullen and Mulligan, CPAs, were conducting the audit of Cusick

McMullen and Mulligan, CPAs, were conducting the audit of Cusick Machine Tool Company for the year ended December 31. Jim Sigmund, senior-in-charge of the audit, plans to use MUS to audit Cusickâ...

Q: The accounting firm of Johnson and Johnson has decided to design a

The accounting firm of Johnson and Johnson has decided to design a non statistical sample to examine the accounts receivable balance of Francisco Fragrances, Inc., at October 31. As of October 31, the...

Q: World-famous mining mogul Steve Wilsey hired the public accounting firm

World-famous mining mogul Steve Wilsey hired the public accounting firm of Joe Wang Associates, PC, to conduct an audit of his new acquisition, Cougar Goldust, Inc. The gold inventory was scheduled to...

Q: You are in charge of the audit of Hipp Supply Company for

You are in charge of the audit of Hipp Supply Company for the year ended December 31. In prior years, your firm observed the inventory and tested compilation and pricing. Various misstatements were al...

Q: For each of the following situations, indicate the audit evidence that

For each of the following situations, indicate the audit evidence that should be obtained to determine whether revenue should be recognized or not in the current period. Use the five-step approach for...

Q: The Art Appreciation Society operates a museum for the benefit and enjoyment

The Art Appreciation Society operates a museum for the benefit and enjoyment of 10-6, 10-9 the community. During the hours the museum is open to the public, two clerks who are positioned at the entran...

Q: Adam Signoff-On, CPA, was auditing Defense Industries,

Adam Signoff-On, CPA, was auditing Defense Industries, Inc. Signoff-On sent positive accounts receivable confirmations to a number of Defense’s government customers. He received a number of returned c...

Q: The “Accounts Receivable—Confirmation Statistics” working paper shown on

The “Accounts Receivable—Confirmation Statistics” working paper shown on the next page was prepared by an audit assistant for the 2018 audit of Le...

Q: What are the primary elements involved in the planning phase of an

What are the primary elements involved in the planning phase of an audit?

Q: During the year, Strang Corporation began to encounter cash-flow

During the year, Strang Corporation began to encounter cash-flow difficulties, and 10-15 a cursory review by management revealed receivable collection problems. Strang’s management engaged Stanley, C...