22-28 (Objectives 22-3, 22-4) The following audit procedures are commonly performed by auditors in the verification of owners' equity:

1. Review the articles of incorporation and bylaws for provisions about owners' equity.

2. Analyze all owners' equity accounts for the year and document the nature of any recorded change in each account.

3. Account for all certificate numbers in the capital stock book for all shares outstanding.

4. Examine the stock certificate book for any stock that was cancelled.

5. Review the minutes of the board of directors' meetings for the year for approvals related to owners' equity.

6. Recompute earnings per share.

7. Review debt provisions and senior securities with respect to liquidation preferences, dividends in arrears, and restrictions on the payment of dividends or the issue of stock.

a. State the purpose of each of these seven audit procedures.

b. List the type of misstatements the auditors can uncover by the use of each audit procedure.