list 3 possible ways that auditor independence could be further enhanced and improved beyond what is currently in place in practice or through auditing standards.

i)Able to explain in detail and clearly the companies’ dividend payout trend based on the ratios computed above, Clear and detailed explanation on the factors that influence the companies’ dividend policy decision during the five-year period,Able to relate the explanation with relevant dividend theories and concepts.

(300 word only)

Lahser Corp. produces component parts for durable medical equipment manufacturers. The controller is building a master budget for the first quarter of the upcoming calendar year. Selected information from the accounting records is presented next:

a. Accounts Receivable as of January 1 are $56,800. Selling price per unit is projected to remain stable at $13 per unit throughout the budget period. Sales for the first six months of the upcoming year are budgeted to be as follows: January $99,100 February $118,100 March $114,700 April $108,400 May $103,300 June $121,200

b. Sales are 20% cash and 80% credit. All credit sales are collected in the month following the sale.

c. Lahser Corp. has a policy that states that each month’s ending inventory of finished goods should be 10% of the following month’s sales (in units).

d. Three pounds of direct material is needed per unit at $2.20 per pound. Ending inventory of direct materials should be 20% of next month’s production needs.

e. Monthly manufacturing overhead costs are $5,530 for factory rent, $2,900 for other fixed manufacturing costs, and $1.10 per unit produced for variable manufacturing overhead. All costs are paid in the month in which they are incurred.

Questions:

1. What are the budgeted total cash collections for the 1st quarter? (1 point)

2. What are the budgeted total cash collections for the 2nd quarter? (1 point)

3. What is the budgeted production for the first quarter in terms of number of units? (HINT: Convert total sales to unit sales for each month) (1 point)

4. What is the budgeted direct materials cost for the first quarter? (1 point)

5. What is the budgeted manufacturing overhead for the first quarter? (1 point)

The management team of Wickersham Brothers Inc. is preparing its annual financial statements. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statements are summarized.

Other information from the company’s records includes the following:

• Bought equipment for cash, $107,000.
• Paid $19,500 on long-term note payable.
• Issued new shares of common stock for $20,000 cash.
• Cash dividends of $33,600 were declared and paid to stockholders.
• Accounts Payable arose from inventory purchases on credit.
• Income tax expense ($25,910) and interest expense ($5,850) were paid in full at the end of both years and are included in Other Expenses.

Advanced Enterprises reports yearminusend information from 2018 as follows: Sales (160,250 units) $968,000 Cost of goods sold 641,000 Gross margin 327,000 Operating expenses 263,000 Operating income $64,000 Advanced is developing the 2019 budget. In 2019 the company would like to increase selling prices by 14.5%, and as a result expects a decrease in sales volume of 9%. All other operating expenses are expected to remain constant. Assume that cost of goods sold is a variable cost and that operating expenses are a fixed cost. Should Advanced increase the selling price in 2019? A. Yes, because operating income increases for 2019. B. Yes, because sales revenue increases for 2019. C. No, because gross margin decreases for 2019. D. No, because sales volume decreases for 2019.

During the summer between his junior and senior years, James Cook needed to earn sufficient money for the coming academic year. Unable to obtain a job with a reasonable salary, he decided to try the lawn care business for three months. After a survey of the market potential, James bought a used pickup truck on June 1 for $1,340. On each door he painted "James Cook Lawn Service, Phone 471-4487." He also spent $740 for mowers, trimmers, and tools. To acquire these items, he borrowed $2,510 cash by signing a note payable promising to pay the $2,510 plus interest of $70 at the end of the three months (ending August 31). By the end of the summer, James had done a lot of work and his bank account looked good. This prompted him to wonder how much profit the business had earned. A review of the check stubs showed the following: Bank deposits of collections from customers totaled $12,500. The following checks had been written: gas, oil, and lubrication, $1,110; pickup repairs, $340; mower repair, $110; miscellaneous supplies used, $100; helpers, $5,500; payroll taxes, $360; payment for assistance in preparing payroll tax forms, $40; insurance, $125; telephone, $200; and $2,580 to pay off the note including interest (on August 31). A notebook kept in the pickup, plus some unpaid bills, reflected that customers still owed him $730 for lawn services rendered and that he owed $190 for gas and oil (credit card charges). He estimated that the cost for use of the truck and the other equipment (called depreciation ) for three months amounted to $670. Required: 1. Prepare a quarterly income statement for James Cook Lawn Service for the months June, July, and August. Assume that the company will not be subject to income tax.

A partially completed balance sheet for Blue Co., Inc., as of October 31, 2013, follows. Where amounts are shown for various items, the amounts are correct. Required: Using the following data, complete the balance sheet. a. Blue Co.'s records show that current and former customers owe the firm a total of $4,400; $650 of this amount has been due for more than a year from two customers who are now bankrupt. b. The automobile, which is still being used in the business, cost $17,400 new; a used car dealer's Blue Book shows that it is now worth $10,000. Management estimates that the car has been used for one-third of its total potential use. c. The land cost Blue Co. $11,000; it was recently assessed for real estate tax purposes at a value of $15,000. d. Blue Co.'s president isn't sure of the amount of the note payable, but he does know that he signed a note. e. Since Blue Co. was formed, net income has totaled $33,000, and dividends to stockholders have totaled $21,250. Loading...

Preparing an Income Statement and a Statement of Comprehensive Income

The following pretax amounts are taken from the adjusted trial balance of Avoca Auto Corp. at December 31, 2020, its annual year-end.

Sales Revenue $416,000

Cost of good sold 176,000

operating expenses 128,000

gain on debt retirement 32,000

interest expense 12,800

loss from discontinued operations. 80,000

retained earnings balance, December 31, 2019 48,000

dividends declared and paid 40,000

unrealized holding gain on debt investment securities, net of tax 6,400

Common stock, weighted average shares outstanding 16,000 Shares

Required

a. Prepare a single-step income statement. Assume an average 25% tax rate on all items. Include earnings per share disclosures.
b. Prepare a comprehensive income statement by showing a separate but consecutive statement of comprehensive income. Ignore earnings per share disclosures.
c. Compute the ending retained earnings balance at December 31, 2020.

• Enter revenues and gains and expenses and losses in the order of the largest dollar amount to the smallest dollar amount.
• Do not use negative signs with any of your answers.
• Round the per share amounts to two decimal places.

Explain one audit technique you would use to determine the existence of a material error on inventory account?

Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own division’s return on investment (ROI). Assume the following information relative to the two divisions:

*Before any purchase discount.

Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated. Required:

1. Refer to case 1 shown above. Alpha Division can avoid $4 per unit in commissions on any sales to Beta Division.

a. What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Will the managers probably agree to a transfer?

2. Refer to case 2 shown above. A study indicates that Alpha Division can avoid $5 per unit in shipping costs on any sales to Beta Division.

a. What is the lowest acceptable transfer price from the perspective of the Alpha Division? b. What is the highest acceptable transfer price from the perspective of the Beta Division? c. What is the range of acceptable transfer prices (if any) between the two divisions? Would you expect any disagreement between the two divisional managers over what the exact transfer price should be? d. Assume Alpha Division offers to sell 72,000 units to Beta Division for $34 per unit and that Beta Division refuses this price. What will be the loss in potential profits for the company as a whole?

3. Refer to case 3 shown above. Assume that Beta Division is now receiving an 4% price discount from the outside supplier.

a. What is the lowest acceptable transfer price from the perspective of the Alpha Division?

b. What is the highest acceptable transfer price from the perspective of the Beta Division?

c. What is the range of acceptable transfer prices (if any) between the two divisions? Will the managers probably agree to a transfer?

d. Assume Beta Division offers to purchase 20,000 units from Alpha Division at $53.56 per unit. If Alpha Division accepts this price, would you expect its ROI to increase, decrease, or remain unchanged?

4. Refer to case 4 shown above. Assume that Beta Division wants Alpha Division to provide it with 64,000 units of a different product from the one Alpha Division is producing now. The new product would require $26 per unit in variable costs and would require that Alpha Division cut back production of its present product by 32,000 units annually. What is the lowest acceptable transfer price from Alpha Division’s perspective?

Accumulated earnings - Why do you think some 'tax experts' consider accumulated earnings an important issue to study?

The following information is from Remmer Company for the year 2017. Accounts Payable $145,000 Accounts Receivable 15,000 Cash (balance on January 1, 2017) 75,000 Cash (balance on December 31, 2017) Common Stock 100,000 Dividends 10,000 Equipment 755,000 Notes Payable 30,000 Office Expenses 95,000 Prepaid Rent 50,000 Retained Earnings (Jan 1 2017) 410,000 Retained Earnings (December 31, 2017) Salaries and Wages Expense 955,000 Salaries and Wages Payable 170,000 Sales Revenue 1,660,000 Supplies 25,000 Utilities Expense 530,000 Cash from Operating Activities 171,000 Cash from Investing Activities (40,000) Cash from Financing Activities (126,000) Required: 1. Using what you know about the relationship of the financial statements, solve for the ending Cash and ending Retained Earnings balances. 2. Prepare the four financial statements (Income Statement, Statement of Retained earnings, Balance Sheet and Statement of Cash Flows) for Remmer Company as of December 31, 2017. 3. Compute the following for Remmer Company: (Use year-end amounts as opposed to the averages for your calculations.) a. Return on Assets b. Profit Margin c. Asset Turnover d. Return on Equity 4. Do ratios alone provide enough information to gauge a company’s performance? What other information would help you to better utilize these ratios to make your decision about the company?

The following cost data describes the flow of costs for the year ending 31 December 2018 relates to Precise Manufacturing Ltd.

The company uses normal costing and the manufacturing overhead is applied at the rate of 120% of direct labour cost.

Required:

Determine the missing amounts in each of the divisions shown above.

Problem 9-6AA Entries for payroll transactions LO P2, P3, P5

Francisco Company has 10 employees, each of whom earns $3,100 per month and is paid on the last day of each month. All 10 have been employed continuously at this amount since January 1. On March 1, the following accounts and balances exist in its general ledger:

1. FICA—Social Security Taxes Payable, $3,844; FICA—Medicare Taxes Payable, $900. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.)
2. Employees' Federal Income Taxes Payable, $7,750 (liability for February only).
3. Federal Unemployment Taxes Payable, $372 (liability for January and February together).
4. State Unemployment Taxes Payable, $2,480 (liability for January and February together).

During March and April, the company had the following payroll transactions.

* FICA taxes are Social Security and Medicare, respectively.

Required:
Prepare journal entries to record the transactions and events for both March and April. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)

Two things can cause a budget variance; quantity and cost. Why is a flexible budget essential for managers? What departments are responsible for quantity variances? Cost variances?   As a manager why do you think it is necessary to differentiate these causes?