As part of the fieldwork of an audit engagement, the senior on the audit obtained and documented an understanding of the company's internal control relating to accounts receivable and assessed control risk related to accounts receivable at the maximum level. Alejandro, the staff person assigned to the engagement, requested and obtained from the company an aged accounts receivable schedule listing the total amount owed by each customer as of December 31, 2017, and sent positive confirmation requests to a sample of the company customers. Review Alejandro's comments on each of the following five confirmations and determine the best conclusion and/or follow-up procedures for each item.Assume that each confirmation has been signed with the appropriate signature unless otherwise noted.

Confirmation Letters

February 1, 2018

Performance Marine Sales, Inc.

1284 River Road

Louisville, Kentucky 40059

Re: Balance at December 31, 2017 - $267,000

Dear Sirs:

As of December 31, 2017, our records indicate your balance with our company as the amount listed above. Return the entire letter to our auditors, JS LLP, PO Box 100, Orlando, Florida 32806.

A stamped, self-addressed envelope is enclosed for your convenience.

Sincerely,

Aquatic Jet Products, Inc.

The above balance is

Incorrect (show amount) $325,000

If incorrect, please provide information that could help to reconcile your account.

Response:We placed an order for $58,000 on December 26, 2017.

Signature

Title

Date

Alejandro's note to file:

Per discussion with the controller, the order for $58,000 was shipped FOB shipping point on December 30, 2017, and was received by the customer on January 3, 2018. .Therefore, no entry has been made to record the sale in 2017.

February 1, 2018

West Coast Ski Center, Inc.

163 Tide Avenue

Monterey, California 93940

Re: Balance at December 31, 2017 - $414,000

Dear Sirs:

As of December 31, 2017, our records indicate your balance with our company as the amount listed above. Return the entire letter to our auditors, JS LLP, PO Box 100, Orlando, Florida 32806.

A stamped, self-addressed envelope is enclosed for your convenience.

Sincerely,

Aquatic Jet Products, Inc.

The above balance is

Incorrect (show amount) $320,000

If incorrect, please provide information that could help to reconcile your account.

Response:We made a payment of $94,000 on December 12, 2017.

Signature

Title

Date

Alejandro's note to file:

Per discussion with the controller, the company received the payment of $94,000 on December 15, 2017, and posted it to "Other Income."

February 1, 2018

Fish & Ski World, Inc.

5660 Ocean Blvd.

Port Arkansas, Texas 78373

Re: Balance at December 31, 2017 - $72,000

Dear Sirs:

As of December 31, 2017, our records indicate your balance with our company as the amount listed above. Return the entire letter to our auditors, JS LLP, PO Box 100, Orlando, Florida 32806.

A stamped, self-addressed envelope is enclosed for your convenience.

Sincerely,

Aquatic Jet Products, Inc.

The above balance is

Incorrect (show amount) $163,000

If incorrect, please provide information that could help to reconcile your account.

Response: Per our records, the following invoices are outstanding:

Invoice #4212 $72,000

Invoice #4593 $66,000

Invoice #4738 $25,000

Signature

Title

Date

Alejandro's note to file:

Invoices #4593 and 4738 are not on the A/R aging report at December 31, 2017.

February 1, 2018

NC Boating Center, Inc.

110 Windward Blvd.

Tierra Verde, Florida 33715

Re: Balance at December 31, 2017 - $239,000

Dear Sirs:

As of December 31, 2017, our records indicate your balance with our company as the amount listed above. Return the entire letter to our auditors, JS LLP, PO Box 100, Orlando, Florida 32806.

A stamped, self-addressed envelope is enclosed for your convenience.

Sincerely,

Aquatic Jet Products, Inc.

The above balance is

Correct or Incorrect (show amount) $

If incorrect, please provide information that could help to reconcile your account.

Response: We cannot determine the balance due at December 31, 2017.

Signature

Title

Date

Alejandro's note to file:

No amount was confirmed on the response letter.

February 1, 2018

Desert Boats

2135 W. Lane Ave.

Tempe, Arizona 85287

Re: Balance at December 31, 2017 - $60,000

Dear Sirs:

As of December 31, 2017, our records indicate your balance with our company as the amount listed above. Return the entire letter to our auditors, JS LLP, PO Box 100, Orlando, Florida 32806.

A stamped, self-addressed envelope is enclosed for your convenience.

Sincerely,

Aquatic Jet Products, Inc.

The above balance is

Correct / Incorrect (show amount) $ 0

If incorrect, please provide information that could help to reconcile your account.

Response: We mailed the entire amount on December 30, 2017.So the balance is completely incorrect.

Signature

Title

Date

Alejandro's note to file:

I found cash recorded as received in the cash receipts journal on January 3, 2018.