Perform to test the correctness of pricing of raw materials

Assignment Help Financial Accounting
Reference no: EM13747241

Mt. Hood Furniture—PPS sampling problem) You have been assigned the task of testing the accuracy of the final inventory compilation for Mt. Hood Furniture. You may assume that you have separately observed the inventory and that you are satisfied that the inventory was accurately counted. However, you need to test that quantities were accurately transcribed to the final accumulation and valuation of inventory and that the inventory is correctly priced and accumulated. The table beginning on page 617 presents the audited values associated with Mt. Hood's pricing and accumulation of all items in inventory.

The book values $6,753,764. You may assume that you have performed the tests to determine the proper pricing for raw materials, work in process, and finished goods. The student should understand that the auditor will normally obtain this information only for the items included in the sample.

Required:

Explain the tests that you would perform to test the correctness of pricing of raw materials, work in progress, and finished goods. (The student may wish to consult Chapter 16.)

Determine the amount of projected population misstatement based on your sample.

Reference no: EM13747241

Questions Cloud

Internal-external users in governments than in businesses : Why is it more difficult to distinguish between internal and external users in governments than in businesses? From what two perspectives must the financial statements under the Governmental Accounting Standards Board (GASB) No. 34 reporting model be..
Regression equation developed using sample data : To test if the slope coefficient ß1 in the population regression model is significantly different from zero, a hypothesis test is conducted on the slope coefficient b1 in the regression equation developed using sample data.
Inclusion would have an antidilutive effect : In periods when we recognize a net loss, we exclude the impact of outstanding stock awards from the diluted loss per share calculation as their inclusion would have an antidilutive effect.
What is the carrying value of the asset : Cany Company uses special strapping equipment in its packaging business. The equipment was purchased in January 2013 for $8,000,000 and had an estimated useful life of 8 years with no salvage value. At December 31, 2014, new technology was introduced..
Perform to test the correctness of pricing of raw materials : Mt. Hood Furniture—PPS sampling problem) You have been assigned the task of testing the accuracy of the final inventory compilation for Mt. Hood Furniture. You may assume that you have separately observed the inventory and that you are satisfied that..
Bond premium and discount by the effective-interest method : On December 31, 2010, Bible Distributing Company issues 8%, 10-year convertible bonds with a maturity value of $700,000. The semiannual interest dates are June 30 and December 31. The market interest rate is 9%, and the issue price of the bonds is 94..
Predetermined overhead rates to apply manufacturing overhead : The Raleigh Company is located in North Carolina and uses predetermined overhead rates to apply manufacturing overhead costs to jobs. The predetermined overhead rate is based on machine hours in Department A and direct labor costs in Department B. At..
Computing liquidity ratios : The quick ratio is quite a bit lower than the current ratio, so inventory seems to be an important component of current assets
Marketing managers recommendation is adopted : Bismarck Corporation has a single product whose selling price is $19. At an expected sales level of $1,840,000, the company's variable expenses are $560,000 and its fixed expenses are $300,000. The marketing manager has recommended paying a sales com..

Reviews

Write a Review

Financial Accounting Questions & Answers

  Comparison between consumer price index

Comparison between Consumer Price Index and Producer Price Index and Estimation of Item's Current Price.

  Describe major weakness of the performance report

Describe the major weakness of the performance report and describe clearly why all the variances for the variable expenses are unfavorable (U).

  After the accounts are closed on september 10 2010 prior to

after the accounts are closed on september 10 2010 prior to liquidating the partnership the capital accounts of kris

  What action would san fernando take on its export pricing

What action could San Fernando take on its export pricing? What probable U.S. government action may result from your decision in 1?

  Prepare the consolidated financial statements

Prepare the consolidated financial statements for 20X3 using the direct method, Prepare the consolidated financial statements for Peony at December 31, 20X6 using the direct method.  Show all your work.

  Calculate the revenues for riley co. for apri

During the month of April, Riley Co. had cash receipts from customers of $680,000. Expenses totaled $624,000, and accrual basis net income was $168,000. There were no gains or losses during the month.

  Show new balances after each transaction

Then use additions and subtractions to show the effects of the transactions on individual items of the accounting equation. Show new balances after each transaction.

  Produces and sells two produtcs-standard and deluxe

Lincoln Corporation produces and sells two produtcs : Standard and Deluxe. The info on the two products sold for the last month is given below. The common fixed cost is $15,000.

  What is amount of interest that should be capitalized

Other than the construction funds borrowed, the only other debt outstanding during the year was a $1,000,000, 10-year, 9% note payable dated 1/1/2006. What is amount of interest that should be capitalized by Bass during 2012?

  How might bernhardt appliance management use its accounts

How might Bernhardt Appliance’s management use its accounts receivable and notes receivable to raise the cash it needs? What are the company’s prospects for raising the needed cash?

  Finished goods inventory under absorption costing method

If Eagle had sold only 9,000 tables in its first year, what total amount of cost would have been assigned to the 1,000 tables in finished goods inventory under absorption costing method?

  Prepare the statement of cash flows for 2007

Classify each of the following transactions as an operating activity, an investing activity or a financing activity cash flow, or a non cash transaction - Indicate also its effect on the Income statement (increase or decrease the profit).

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!

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