Discuss an example of when revenue (income) may be reported before the point of sale.

The audit program for the revenue account for a client has been drafted. The following item appears:

Required

a.  Does the procedure address the stated assertion? Explain.

b.  If your answer to part a is no, provide the correct assertion or explain what work would be required to address the assertion.

c.  Explain what type of evidence is obtained by performing the stated procedure. How persuasive is it?

Briefly explain the rules of debits and credits as they relate to assets, liabilities, equity, revenue, and expenses.

URGENT: NEED ANSWER ASAP

PLEASE RESPOND WITH COPY AND PASTE, NOT ATTACHMENT USE ORIGINAL CONTENT NOT USED BEFORE ON CHEGG

PLEASE ANSWER THROUGHLY TO ALL ANSWER TO BEST ABILITES ORIGINAL SOURCE NEVER USED BEFORE!!!

A company sold a total of 1,000 units for total sales revenue of $70,000.

The company incurred total variable expenses of $38,500 and total fixed expenses of $ 23,310.

Based on this, the company reported a total contribution margin of $31,500 and net operating income of $ 8,190.

Use this information to answer the following questions. Assume that all units are within the relevant range.

1 Calculate the net operating income if the variable cost per unit increases by $1, spending on fixed costs increases by $1,600, and unit sales increase by 220 units.

2 Calculate the break-even point in unit sales.

3 Calculate the break-even point in unit sales.

4 Calculate the number of units that must be sold to earn a target profit of $18,900.

1. A capital investment of$10,000 can be made in a project that will produce uniform revenue of $5320 for five years and then have an estimated salvage value of $2,000. Annual expenses will be $3,000. The company is willing to accept any project that will earn at least 10% per year (including inflation), before income tax. Determine whether it is acceptable?

a. What is the IRR for this investment?

b. What is the benefit-cost ratio for this investment?

c. What is the Pay-Back Period for this investment?

2. A piece of equipment has been proposed to increase the productivity of a certain manual welding operation. The investment costs $25,000, and the equipment will have a salvage value of $5,000 at the end of its expected life of years. Increase productivity attribute to the equipment will amount to $8,000 per year increased gross income. Evaluate the IRR of the proposed equipment. If the MARR is 17, is the investment a good one?

A new magnetic crane for the junkyard will cost $120000 and will generate $27000 revenue per year for 6 years. The salvage value will be $30000 after the 6 years. Assume the equipment has a 7% MARR.

a) Determine the IRR for the machine. Please use interpolation.

b) Since the company requires at least 5% return on their investment, should the machine be purchased? Why?

The new president of Malawi is looking for ways of increasing the revenue his government collects. At the moment, he is undecided between imposing a specific tariff on imports or a quota whereby the quota licenses will be auctioned in a competitive market.

i) Given the two options, what choice should he make? Give any two reasons.

ii) Are the two options the president is considering optimal avenues for collecting government revenue?

Use python

There is a revenue list, how to covert it from string to int?

Here is the list

['$8,120,000,000', '$8,085,200,000', '$7,703,000,000', '$7,000,000,000', '$5,410,000,000', '$4,212,000,000', '$3,741,400,000', '$3,500,000,000', '$3,000,000,000', '$2,800,000,000', '$2,800,000,000', '$2,529,000,000', '$2,087,600,000', '$2,000,000,000', '$1,900,000,000', '$1,520,000,000', '$1,500,000,000', '$1,500,000,000', '$1,350,000,000', '$1,300,000,000', '$1,400,000,000', '$1,400,000,000', '$1,395,000,000', '$1,200,000,000', '$1,000,000,000', '$1,000,000,000', '$842,000,000', '$887,000,000', '$860,000,000', '$825,000,000', '$799,000,000', '$757,000,000', '$751,000,000', '$701,600,000', '$660,000,000', '$600,000,000', '$577,000,000', '$559,000,000', '$540,000,000', '$532,000,000', '$518,400,000', '$500,000,000', '$500,000,000', '$437,000,000', '$400,000,000', '$350,000,000', '$300,000,000', '$277,000,000'].

Felix Corp. is evaluating a contract to determine proper revenue recognition. The contract is for construction of 10 yachts for a total price of $10,000,000. The customer needs the boats in its showrooms by March 1, 2018, for the yacht purchase season; the customer will provide a bonus payment of $100,000 if all yachts are delivered by the March 1 deadline. The bonus is reduced by $25,000 each week that the boats are delivered after the deadline until no bonus is paid if the boats are delivered after March 22, 2018. Felix frequently includes such bonus terms in it contracts and thus has good historical data for estimating the probabilities of completion at different dates. It estimates an equal probability (25%) for each full delivery outcome.

A. How should Felix determine the transaction price under FASB ASC 606 for this contract?

B. Assume that Felix has limited experience with a construction project on the same scale as the 10 yachts. How should Felix determine the transaction price for this contract?

Required: Summarize why revenue is such a critical account in most companies and the auditor's challenge in auditing this area. Then address the following questions regarding the Miniscribe audit which is described below. a) Summarize the business and financial reporting risks that increased the risk of material misstatement at Miniscribe. b) Summarize the techniques used by Miniscribe to inflate their financial statements. For each technique, describe the audit procedure(s) the auditors should/could have used to detect these misstatements? c) Identify any red flags that the auditors should have noticed during the audit. MiniScribe Corporation Read the summary below of the MiniScribe Corporation and answer the questions that follow. "In October 1988, MiniScribe, a computer disk drive manufacturer, announced its thirteenth consecutive record-breaking quarter, while its competitors were laying off hundreds of employees. MiniScribe's receivables had increased significantly, and inventories had increased to a dangerous level because disk drives can become obsolete from one quarter to the next. The company's stock price had quintupled in just two years. It had apparently risen from the dead under the leadership of Q.T. Wiles, who had resurrected other companies and was known as "Dr. Fix-It." It looked as if he had done it again. Seven months later, it was announced that MiniScribe's sales gains had been fabricated. What was supposed to be the crowning achievement of Wiles' career became an epitaph; he resigned and is living in near seclusion. An internal investigation concluded that senior management apparently perpetrated a massive fraud on the company, its directors, its outside auditors, and the investing public. Most of MiniScribe's top management was dismissed, and layoffs shrank its employment by more than 30% in one year. MiniScribe might have to write off as much as $200 million in bad inventory and uncollectable receivables. Wiles' unrealistic sales targets and abusive management style created a pressure cooker that drove managers to cook the books or perish. And cook they did - booking sales prematurely, manipulating reserves, and simply fabricating figures - to maintain the illusion of unbounded growth even after the industry was hit by a severe slump. When Wiles arrived at MiniScribe in mid-1985, it had just lost its biggest customer, IBM, which decided to make its own drives. With the personal computer industry then slumping, MiniScribe was drowning in red ink. Dr. Fix-It's prescription was to cut 20% of the workforce and overhaul the company from top to bottom. As part of the overhaul, several semi-autonomous divisions were created. Each division manager set the division's own budget, sales quotas, incentives, and work rules. The company became a chaotic Babel of at least 20 mini-companies that were constantly being changed and reorganized. One employee held 20 different positions in less than seven years. Wiles turned up the heat under his lieutenants. Four times a year, he would summon as many as 100 employees for several days of intense meetings, at which they were force-fed his idiosyncratic management philosophy. At one of the first such meetings he held, Wiles demanded that two controllers stand, and he fired them on the spot, saying, "That's just to show everyone I'm in control of the company." At each of these meetings, division managers had to present and defend their business plan. Invariably, Wiles would find such plans deficient and would berate their authors in front of their peers. A former controller says Wiles would throw, kick, and rip the plan books that displeased him, showering his intimidated audience with paper while yelling, "Why don't you understand this? Why can't you understand how to do this?" Then something changed. Wiles started saying, "I no longer want to be remembered as a turnaround artist. I want to be remembered as the man who made MiniScribe a billion-dollar company." Sales objectives became the company's driving force, and financial results became the sole determinant of whether bonuses were awarded. Wiles said, "This is the number we want to hit first quarter, second quarter, third quarter, and so on," and it was amazing to see how close they could get to the number they wanted to hit. Hitting the number became a company-wide obsession. Although many high-tech manufacturers accelerate shipments at the end of quarter to boost sales - a practice known as "stuffing the channel" - MiniScribe went several steps beyond that. On one occasion, an analyst relates, the company shipped more than twice as many disk drives to a computer manufacturer as had been ordered; a former sales manager says the excess shipment was worth about $9 million. MiniScribe later said it had shipped the excess drives by mistake. The extras were returned - but by then MiniScribe had posted the sale at the higher number. Wiles denied this practice. Other accounting maneuvers involved shipments of disk drives from MiniScribe's factory in Singapore. Most shipments went by airfreight, but a squeeze on air cargo space toward the end of each quarter would force some shipments onto cargo ships, which required up to two weeks for transit. On several occasions, said a former division manager, MiniScribe executives looking to raise sales, changed purchase orders to show that a customer took title to a shipment in Singapore when, in fact, title would not change until the drives were delivered in the United States. Specifically, MiniScribe executives were adamant that the 1986 year-end results should include as sales the cargo on a freighter that they contended had set sail in late December. Eventually, the cargo and the freighter, (which did not exist), were simply forgotten. MiniScribe executives also found other ways to inflate sales figures. One was to manipulate reserves for returns of defective merchandise and bad debts. The problem of inadequate reserves grew so great that private analysts began noticing it. MiniScribe was booking less than 1% reserves; the rest of the industry had reserves ranging from 4% to 10%. To avoid booking losses on returns in excess of its skimpy reserves, defective drives would be tossed onto a "dog pile" and booked as inventory. Eventually, the dog-pile drives would be shipped out again to new customers, continuing the cycle. Returns of defective merchandise ran as high as 15%. At a time of strong market demand, such ploys enabled MiniScribe to seem to grow almost exponentially, posting sales of $185 million in 1986 and $362 million in 1987. In early 1988, Wiles was confidently forecasting a $660 million year, and he held fast to his rosy forecast even as disk drive sales started slipping industrywide in late spring and nosedived in autumn. Meanwhile, Whiles increased the pressure on his managers. Division reports would be doctored as they rose from one bureaucratic level to the next. Before long, the accounting gimmickry became increasingly brazen. Division managers were told to "force the numbers." Workers whispered that bricks were being shipped just so a division could claim to have met its quota. Others joked that unwanted disk drives were being shipped and returned so often that they had to be repackaged because the boxes wore out. Employees also joked about shipments to "account BW," an acronym for "big warehouse." But that wasn't just a joke. MiniScribe established several warehouses around the country and in Canada as "just-in-time" suppliers for distributors. Customers weren't invoiced until they received shipments from the warehouses. MiniScribe, however, was booking shipments to the warehouses as sales. The number of disk drives shipped to the warehouses was at MiniScribe's discretion. It is estimated that between $80 million and $100 million worth of unordered disk drives went to the warehouses. Wall Street began to smell trouble. Analysts could find no significant customers other than Compaq to support MiniScribe's bullish forecasts. Several major anticipated orders from Apple Computer and Digital Equipment Corp. fell through. MiniScribe reported a fourth-quarter loss and a drop in net income for 1988 despite a 66% increase in sales - on paper, that is. A week later, Wiles abruptly resigned. The stock price tumbled from a high of $15 to less than $3 per share, a decline that upset many stockholders. An investigative committee of MiniScribe's outside directors reported that senior company officials: " Apparently broke into locked trunks containing the auditors' working papers during the year-end 1986 audit and changed inventory figures, inflating inventory values by approximately $1 million. " Packaged bricks and shipped them to distributors as disk drives in 1987, recording $4.3 million in sales; when the shipments were returned, MiniScribe inflated its inventory by the purported cost of the bricks. " Packed approximately 6,300 disk drives that had been contaminated to inflate inventory during the fourth quarter of 1988. Several lawsuits have been filed charging MiniScribe with engineering phony sales artificially to inflate its stock to benefit insiders. The suits also charge that its auditors participated in the conspiracy by falsely certifying the company's financial statements. "