Hello Im stuck with this. I need help ASAP. I need to turn in I-3,I-4, I-5
PRICING INFORMATION from INVOICES - Sea Gull Airframes I-Z Voucher Voucher Receiving Number Date Date Paid Terms Report Date lnvolee Descrbtlon 7-68 8-01-12 8-21-12 Net FOB 8-01-12 77 V16 fasteners at $10 per dozen destination 11-81 10-16-16 11-15-16 Net FOB 10-18-16 1,100 yards R01 metal ribs at $9.50 destination per yard: 2,000 feet St26 struts at $8.20 per foot 12-06 12-08-16 12-30-16 2/10, nl30 FOB 12-10-16 180 L803 steel leaf springs at $69 S.P. each 12-09 12-10-16 12-18-16 Net FOB 12-11-16 45 industrial hand drills at $20 each: destination guaranteed for 4 years 121 8 12-2746 12-27-16 2/10, nl30 FOB 1221-16 4,200 meters 1.37 spars at $8 per S.P. meter 12-23 12-2416 1-03-17 2/ 10, n/30 FOB 12-26-16 12,800 inches 368 metal formers at dest. $1.20 per foot 12-61 12-29-16 1-08-17 Net FOB 12-29-16 1,000 yards R01 metal ribs at $10 per destination yard; 800 feet 5:26 struts at $8 per foot 12-81 12-31-16 1-20-17 Net FOB 1-06-17 2,000 meters L37 spars at $7.50 per destination meter; 2,000 yards R01 metal ribs at $10 per yard In addition, you noted a freight bill for voucher 12-23 in the amount of $200. This bill was entered in the freight-in account. Virtually all freight was for the metal formers. Audit Program for Inventory Pricing 1-3 Audit Objectives: Valuation PREPARED BY: Accuracy REVIEWED BY: Sea Gull Airframes Inc. 12/31/2016 Inventory Procedure Prepared by WP Ref 1) Recompute the extended pricing 2) Verify pricing is reasonable by vouching pricing on inventory items to invoices. (Ignore purchase discounts) 3) Recompute inventory using FIFO cost flow assumption in a periodic inventory system. 4) Examine invoices to determine if further testing is required for lower of FIFO cost or net realized value rule. 5) Review freight-in charges determine if these charges have been properly capitalized to inventory. 6) Determine if items are properly classified as inventory. 7) Compare the dates of inventory purchases to the year-end physical of nventory items (units) to determine slow-moving merchandise which may indicate obsolescence. 8) Document a clear, concise comment for each inventory item investigated which would include if further testing is necessary. 9) Based on errors identified in your audit procedures, compute the projected misstatement on the population using the projected misstatement workpaper 10) Document a clear, concise conclusion for this audit section.SEA GULL AIRFRAMES, INC. 1-4 SUMMARY OF INVENTORY MISSTATEMENTS PREPARED BY: QUANTITY PRICE REVIEWED BY: Per Per Recorded Correct Amount of Item No. and Description Inventory | Correct |Difference Inventory | Correct | Difference Amount Amount Misstatement Comments A. L37 Spars 3,000.00 8.00 24,000.00 B. B68 Metal Formers 10,000.00 1.20 12,000.00 C. R01 Metal Ribs 1,500.00 10.00 15,000.00 D. St26 Struts 1,000.00 8.00 8,000.00 E. Industrial hand drills 45.00 20.00 900.00 F. L803 Steel Leaf Springs 40.00 69.00 276.00 G. V16 Fasteners 5.50 10.00 55.00 Total misstatement Items over $5,000 Items under $5,000 CONCLUSION:SEA GULL AIRFRAMES, INC. PROJECTED MISSTATEMENTS 1-5 PREPARED BY: POPULATION # of items REVIEWED BY More than $5,00 500 Less than $5,000 4, 150,000 4,500 $4, 125,000 5,000 8,275,000 Dollars tested Sample Items Over $5,000 Under $5,000 No exceptions 4 G Dollars tested (sample) Projected Misstatement ignoring sampling risk Use ratio estimation for projected misstatement Projected Misstatement Misstatement in Audit in Population More than $5,000 population / sample tested = projected misstatement Less than $5,000 population / sample tested = projected misstatementYou are assigned to the December 31, 2016, audit of Sea Gull Airframes, Inc. The company designs and manufactures aircraft superstructures and airframe components. You observed the physical inventory at December 31 and are satisfied that it was propeny taken. The inventory at December 31, 2016, has been priced, extended, and totaled by the client and is made up of about 5,000 inventory items with a total valuation of $8,275,000. In performing inventory price tests, you have decided to stratify your tests and conclude that you should have two strata: items with a value over $5,000 and those with a value of less than $5,000. The book values are as follows: m mlvalue 5oo wise-000 5,000 $8,275.000 In performing pricing and extension tests, you have decided to test about 50 inventory items in detail. You selected 40 of the over $5,000 items and 10 of those under $5,000 at random from the population. You nd all items to be correct except for items A through G below, which you believe may be misstated. You have tested the following items, to this point, exclusive of A through G: Inventory Items Possibly Misstated Description Quantity Price Total' A. L37 spars 3,000 meters $ BtUO/meter $24,000 B. B68 metal formers 10,0(I) inches 1.20/foot 12,000 C. R01 metal ribs 1,500 yards 10.00/yard 15,000 D. St26 struts 1,000 feet 8.00/foot 8,000 E. Industrial hand drills 45 units 20.00 each 900 F. L803 steel leaf springs 40 pairs 69.00 each spring 276 G. V16 fasteners 5. 50 dozen 10.00 I dozen 5 5 meme are as stated on client's inventory. I-1
