Question
In: Economics
For each of the following scenarios, decide whether you agree or disagree, and then explain your...
For each of the following scenarios, decide whether you agree or disagree, and then explain your answer.
(a) Paddy farmers suffer declines in their total revenues when they become more productive as a group. [4 marks]
(b) Suppose the elasticity of demand for cocaine is -0.1 and the government succeeds in reducing supply substantially. As a result, buyers will now spend less on cocaine. [3 marks]
(c) Every Chinese New Year, vendors bring thousands of Chinese red lanterns to Myanmar. During the last two years, the market has been very competitive; as a result, price has fallen by 30 percent. If the price elasticity of demand were -2.0, vendors would lose revenues as a result of the price reduction. [3 marks]
Solutions
Rahul Sunny answered 1 year agoRelated Solutions
For each of the following scenarios, decide whether you agree or disagree, and then explain your...
For each of the following scenarios, decide whether you agree or
disagree, and then explain your answer. (a) Paddy farmers suffer
declines in their total revenues when they become more productive
as a group. [4 marks]
(b) Suppose the elasticity of demand for cocaine is -0.1 and the
government succeeds in reducing supply substantially. As a result,
buyers will now spend less on cocaine. [3 marks]
(c) Every Chinese New Year, vendors bring thousands of Chinese red
lanterns to Malaysia....
Indicate whether you agree or disagree with the following statements and explain your reasoning. (each 2.5...
Indicate whether you agree or disagree with the
following statements and explain your reasoning. (each 2.5 marks,
total: 10 marks)
a) An auditor is responsible for the preparation and fair
presentation of the financial statements in accordance with
International Financial Reporting Standards, and for such internal
control as is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to
fraud or error. (2.5 marks)
b) An assurance engagement involves evaluation or measurement of...
For each of the following, explain whether you agree or disagree with the accounting treatment. Support...
For each of the following, explain whether you agree or disagree
with the accounting treatment. Support your view with the GAAP
Principles.
A company records all revenue when earned, whether it has been
collected or not.
Payment of a three-year insurance policy is charged to
insurance expense and not adjusted.
Because the December telephone bill did not arrive until
January, no telephone expense was recorded for December.
Indicate whether you agree or disagree with the following statements and explain your reasoning. a) Related...
Indicate whether you agree or disagree with the following
statements and explain your reasoning.
a) Related party
transactions require proper identification and consideration when
considering risk. However, there is no requirement to disclose
related party transactions unless they have an impact on material
misstatements.
b) When assessing
fraud risk, auditors should adopt an attitude of professional
scepticism to ensure that any indicator of a potential fraud is
properly investigated.
c) The
responsibility for preventing and detecting fraud rests with those...
Auditing 2 Indicate whether you agree or disagree with the following statements and explain your reasoning....
Auditing 2
Indicate whether you agree or disagree with the following
statements and explain your reasoning.
a) Svetlana Petrova was reviewing the risk profile of Gaz Prom
Industries in order to determine detection risk. She concluded:
“Both my inherent and control risks are low. I guess I should be
willing to accept high detection risk.”
b) Boris Ivanov had performed an assessment of the accounts payable
system at Magnitogirsk Iron and Steel Works Operations in the
Urals. His focus was...
For each of the following independent statements, state whether you agree or disagree with the statement...
For each of the following independent statements, state
whether you agree or disagree with the statement and fully
explain your answer.
Required
a. The level of audit risk
is low when inherent risk is low.
b. When the auditor
assesses control risk and inherent risk as high, the
acceptable detection risk is
low.
c. When an audit firm
issues the correct opinion on the financial statements under audit,
it still has engagement risk.
d. If...
C. For each of the following situations, (1.) indicate whether you agree or disagree with the...
C. For each of the following situations, (1.) indicate
whether you agree or disagree with the
financial reporting practice employed, then (2.) name
the accounting concept being properly
employed, or name the accounting concept being violated.
(more than one answer may be
appropriate)
Loser Corporation did not disclose that it was the
defendant in a material lawsuit because thetrial was still in
progress.
Alliant Semiconductor Corporation files quarterly and
annual financial statements with the SEC.
Reliant Pharmaceutical Inc. issues financial...
Conceptual Framework: For each of the following situations, state whether you agree or disagree with the...
Conceptual Framework:
For each of the following situations, state whether you agree or
disagree with the financial reporting practice employed, and then
briefly explain the reason and proper treatment if you disagree.
Use the conceptual framework as your guide in deriving
your answer.
The controller of the Dumars Corporation increased the carrying
value of land from its original cost of $2 million to its recently
appraised value of $3.5 million.
The president of Vosburgh Industries asked the company
controller to...
For each of the following independent statements, state whether you agree or disagree with the statement...
For each of the following independent statements, state
whether you agree or disagree with the statement and fully
explainyour answer.
Required
a. Each of the
following changes (considered individually, and holding other
things constant) can be expected to decrease the level of
detection risk
associated with the auditor's
substantive tests:
decreasing materiality
reducing the level of audit risk
b. Auditing
standards require that if an auditor plans to assess control risk
as high, internal controls must be of higher quality and the...
Explain whether you agree or disagree with the following comments: “The Statement of Cash Flows is...
Explain whether you agree or disagree with the following
comments: “The Statement of Cash Flows is overrated. What is it
really telling me that I can’t just find by looking at this year’s
Balance Sheet and seeing how the account balances changed from last
year?”
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