Culture audits are an emerging engagement. E&Y is one of the leaders in this initiative. what a cultural audit is and provide me with information on what is the intent of a cultural audit, how will it impact a review of a corporation, is it tied to ethics (why or why not) and does it help with the financial statement audit and the development of a audit plan?

Thank you

Margin of Safety

Yellow Sticker Company’s variable expenses are 40% of sales. The company has monthly fixed expenses of $15,000 and sells each unit for $0.50. The monthly target operating income is $10,500.

The following selected accounts appear in the ledger of Upscale Construction Inc. at the beginning of the current year:

During the year, the corporation completed a number of transactions affecting the stockholders' equity. They are summarized as follows:

1. Issued 80,000 shares of common stock at $23, receiving cash.
2. Issued 20,000 shares of preferred 2% stock at $192.
3. Purchased 48,000 shares of treasury common for $21 per share.
4. Sold 24,000 shares of treasury common for $24 per share.
5. Sold 16,000 shares of treasury common for $19 per share.
6. Declared cash dividends of $3.50 per share on preferred stock and $0.06 per share on common stock.
7. Paid the cash dividends.

Required:

Journalize the entries to record the transactions. If an amount box does not require an entry, leave it blank.

a. Issued 80,000 shares of common stock at $23, receiving cash.

b. Issued 20,000 shares of preferred 2% stock at $192.

c. Purchased 48,000 shares of treasury common for $21 per share.

d. Sold 24,000 shares of treasury common for $24 per share.

e. Sold 16,000 shares of treasury common for $19 per share.

f. Declared cash dividends of $3.50 per share on preferred stock and $0.06 per share on common stock.

g. Paid the cash dividends.

On January 1, 2021, the Shagri Company began construction on a new manufacturing facility for its own use. The building was completed in 2022. The only interest-bearing debt the company had outstanding during 2021 was long-term bonds with a book value of $11,400,000 and an effective interest rate of 9%. Construction expenditures incurred during 2021 were as follows:

Required:
Calculate the amount of interest capitalized for 2021.
  

Kershaw Electric sold $6,000,000, 10%, 10-year bonds on January 1, 2020. The bonds were dated January 1, 2020, and paid interest on January 1. The bonds were sold at 98.

Prepare entries to record issuance of bonds, interest accrual, and bond redemption.

Instructions

1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020.
2. At December 31, 2020, $8,000 of the Discount on Bonds Payable account has been amortized. Show the balance sheet presentation of the long-term liability at December 31, 2020.
3. On January 1, 2022, when the carrying value of the bonds was $5,896,000, the company redeemed the bonds at 102. Record the redemption of the bonds assuming that interest for the period has already been paid.

Please show all work!

Allocating joint cost
Keiffer Production manufactures three joint products in a single process. The following information is available for August:

Allocate the joint cost of $1,450,800 to the production based on the following:

a. number of gallons.
Note: Round proportions to the nearest tenth of a percentage (i.e. round 13.45% to 13.5%) and dollar amounts to the nearest whole dollar.

b. sales value at split-off.
Note: Round proportions to the nearest whole percentage (i.e. round 13.45% to 13%) and dollar amounts to the nearest whole dollar.

c. approximated net realizable values at split-off.
Note: Round proportions to the nearest whole percentage (i.e. round 13.45% to 13%) and dollar amounts to the nearest whole dollar.

Describe organizational barriers that put people at a disadvantage for promotion, including corporate culture and the pipeline theory. Use anecdotes from your experiences with these types of barriers.

analyze sensitivity, scenario, and simulation:

• Compare and contrast these methods.
• Identify the positive and negative of each method.
• Provide examples of companies that are using these methods.
  • What industries are they involved in?
  • Why do these companies/industries use these methods

The Gibson Management Association held its annual public relations luncheon in April 2017. Based on the previous year’s results, the organization allocated $25,328 of its operating budget to cover the cost of the luncheon. To ensure that costs would be appropriately controlled, Molly Hubbard, the treasurer, prepared the following budget for the 2017 luncheon.

The budget for the luncheon was based on the following expectations.

1. The meal cost per person was expected to be $12.60. The cost driver for meals was attendance, which was expected to be 1,480 individuals.
2. Postage was based on $0.60 per invitation and 3,400 invitations were expected to be mailed. The cost driver for postage was number of invitations mailed.
3. The facility charge is $1,800 for a room that will accommodate up to 1,600 people; the charge for one to hold more than 1,600 people is $2,300.
4. A fixed amount was designated for printing, decorations, the speaker’s gift, and publicity.

Actual results for the luncheon follow.

Reasons for the differences between the budgeted and actual data follow.

1. The president of the organization, Zachary Taylor, increased the invitation list to include 1,000 former members. As a result, 4,400 invitations were mailed.
2. Attendance was 1,700 individuals. Because of higher-than-expected attendance, the luncheon was moved to a larger room, thereby increasing the facility charge to$2,300
3. At the last minute, Ms. Cole decided to add a dessert to the menu, which increased the meal cost to $13.3 per person.
4. Printing, decorations, the speaker’s gift, and publicity costs were as budgeted.

Required:

a. Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget.

b. Compute flexible budget variances by comparing the flexible budget with the actual results.

MusqeemSdnBhd is a firm that offers business and investment consulting services. It is owned by Mr. Mustaqeem. The following transactions were completed on its first month of business operation:

REQUIRED:

(a)        Prepare the relevant journal entries to record the above transactions. Omit the         explanations.

(b)        Post all journal entries in (a) to the ledger.

(c)        Prepare a trial balance as at January 31 2020.

Assume that on January 1, 2017, Elmer’s Restaurants sells a computer system to Pharoah Finance Co. for $780,000 and immediately leases the computer system back. The relevant information is as follows.

Prepare the journal entries for both the lessee and the lessor for 2017 to reflect the sale and leaseback agreement.

Chapter 11 Process Analysis and Resource Utilization - Chapter Review

Bourbon County Court

“Why don’t they buy another copying machine for this office? I waste a lot of valuable time fooling with this machine when I could be preparing my legal cases,” noted Mr. H.C. Morris, as he waited in line. The self-service copying machine was located in a small room immediately outside the entrance of the courtroom. Mr. Morris was the county attorney. He often copied his own papers, as did other lawyers, to keep his legal cases and work confidential. This protected the privacy of his clients as well as his professional and personal ideas about the cases.

He also felt awkward at times standing in line with secretaries, clerks of the court, other attorneys, police officers and sheriffs, building permit inspectors, and the dog warden—all trying, he thought, to see what he was copying. The line for the copying machine often extended out into the hallways of the courthouse.

Mr. Morris mentioned his frustration with the copying machine problem to Judge Hamlet and his summer intern, Dot Gifford. Ms. Gifford was home for the summer and working toward a joint MBA/JD degree from a leading university.

“Mr. Morris, there are ways to find out if that one copying machine is adequate to handle the demand. If you can get the Judge to let me analyze the situation, I think I can help out. We had a similar problem at the law school with word processors and at the business school with student lab microcomputers.”

The next week Judge Hamlet gave Dot the go-ahead to work on the copying machine problem. He asked her to write a management report on the problem with recommendations so he could take it to the Bourbon County Board of Supervisors for their approval. The board faced deficit spending last fiscal year, so the tradeoffs between service and cost must be clearly presented to the board.

Dot’s experience with analyzing similar problems at school helped her know what type of information and data was needed. After several weeks of working on this project, she developed the information contained in Exhibits 11.36, 11.37, and 11.38.

Exhibit 11.36

Bourbon County Court—Customer Arrivals Per Hour (These Data Are Available in the Worksheet Bourbon County Court Case Data in MindTap.)

*A sample of customer arrivals at the copying machine was taken for five consecutive nine-hour work days plus five hours on Saturday for a total of fifty observations. The mean arrival rate is 8.92 arrivals per hour.

Exhibit 11.37

Bourbon County Court—Copying Service Times (These Data Are Available in the Worksheet Bourbon County Court Case Data in MindTap.)

*A sample of customers served at the copying machine was taken for five consecutive nine-hour work days plus five hours on Saturday for a total of fifty observations. The average service time is 0.0917 hours per copying job or 5.499 minutes per job. The equivalent service rate is 10.91 jobs per hour (i.e., ).

Exhibit 11.38

Bourbon County Court—Cost and Customer Mix

*The mix of customers standing in line was collected at the same time as the data in the other case exhibits. Direct wages do include employee benefits but not work opportunity costs or ill-will costs, etc.

Dot was not quite as confident in evaluating this situation as others because the customer mix and associated labor costs seemed more uncertain in the county courthouse. In the law school situation, only secretaries used the word processing terminals; in the business school situation, students were the ones complaining about long waiting times to get on a microcomputer terminal. Moreover, the professor guiding these two past school projects had suggested using queueing models for one project and simulation for the other project. Dot was never clear on how the method of analysis was chosen. Now, she wondered which methodology she should use for the Bourbon County Court situation.

To organize her thinking, Dot listed a few of the questions she needed to address as follows:

1. Assuming a Poisson arrival distribution and an exponential service time distribution, apply queueing models to the case situation and evaluate the results.

2. What are the economics of the situation using queueing model analysis?

3. What are your final recommendations using queueing model analysis.

4. Advanced Question: Do the customer arrival and service empirical (actual) distributions in the case match the theoretical distributions assumed in queueing models?

Discussion board post for my auditing class:

Think about this: assets equal liabilities plus equity. This is the balance sheet and if it balances, and you’ve audited it, then the income statement must be reasonably stated. Right? What’s the point in auditing the income statement if you’ve audited everything else on the balance sheet – and it all balances. In fact, you’ve probably noticed that the focus of all the audit work we’ve studied has been on the balance sheet. Please consider and discuss the reasons why we perform audit procedures on the income statement. Please write an articulate, thoughtful response to the question above. This response should be 200-250 words in length.

Lecimore Company has a centralized purchasing department that

is managed by Meg Shen. Shen has established policies and procedures to guide the clerical

staff and purchasing agents in the day-to-day operation of the department. She is satisfied

that these policies and procedures are in conformity with company objectives and believes

there are no major problems in the regular operations of the purchasing department.

Lecimore’s internal audit department was assigned to perform an operational audit of

the purchasing function. Their first task was to review the specific policies and procedures

established by Shen. The policies and procedures are as follows:

• All significant purchases are made on a competitive bid basis. The probability of

timely delivery, reliability of vendor, and so forth, are taken into consideration on a

subjective basis.

• Detailed specifications of the minimum acceptable quality for all goods purchased

are provided to vendors.

• Vendors’ adherence to the quality specifications is the responsibility of the materials

manager of the inventory control department and not the purchasing department.

The materials manager inspects the goods as they arrive to be sure that the quality

meets the minimum standards and then sees that the goods are transferred from the

receiving dock to the storeroom.

• All purchase requests are prepared by the materials manager based on the production

schedule for a four-month period.

The internal audit staff then observed the operations of the purchasing function and

gathered the following findings:

• One vendor provides 90% of a critical raw material. This vendor has a good delivery

record and is reliable. Furthermore, this vendor has been the low bidder over the

past few years.

• As production plans change, rush and expedite orders are made by production directly

to the purchasing department. Materials ordered for cancelled production

runs are stored for future use. The costs of these special requests are borne by the

purchasing department. Shen considers the additional costs associated with these

special requests as “costs of being a good member of the corporate team.”

Materials to accomplish engineering changes are ordered by the purchasing department

as soon as the changes are made by the engineering department. Shen is proud

of the quick response by the purchasing staff to product changes. Materials on hand

are not reviewed before any orders are placed.

• Partial shipments and advance shipments (that is, those received before the requested

date of delivery) are accepted by the materials manager, who notifies the purchasing

department of the receipt. The purchasing department is responsible for follow-up on

partial shipments. No action is taken to discourage advance shipments.

Based on the purchasing department’s policies and procedures and the findings of

Lecimore’s internal audit staff:

a. Identify deficiencies and/or inefficiencies in Lecimore Company’s purchasing

function.

b. Make recommendations for those deficiencies/inefficiencies that you identify.*