Q 8-33 please short answers
identified the following: creased significantly in the current year. Commission rates have not changed. 2. The rate of inventory turnover has steadily decreased for three years. 3. Inventory as a percent of current assets has steadily increased for four ycars. 4. The number of days sales in accounts receivable has steadily increased for three years. 5. Allowance for uncollectible accounts as a percent of accounts receivable has steadily decreased for three years. The absolute amounts of depreciation expense and depreciation expense as a percent of gross fixed assets are significantly smaller than in the preceding year. a. Evaluate the potential significance of each of the changes in ratios or trends identified in your analysis on the fair presentation of financial statements. b. State the follow-up procedures you would perform for each fluctuation to determine whether a material misstatement exists. 6. 8-33 (OBJECTIVE 8-4) In the audit of the Worldwide Wholesale Company, you did extensive ratio and trend analysis as part of preliminary audit planning. Your analytical procedures 1. Commission expense as a percent of sales was constant for several years but has in- YHTEISIVE mvestiga- identified the following: 3. Inventory as a percent of current assets has steadily increased for four years. years. 4 The number of days' sales in accounts receivable has steadily increased for three years. 5. Allowance for uncollectible accounts as a percent of accounts receivable has steadily decreased for three years. b. The absolute amounts of depreciation expense and depreciation expense as a percent of gross fixed assets are significantly smaller than in the preceding year. 2. Evaluate the potential significance of each of the changes in ratios or trends identified Required in your analysis on the fair presentation of financial statements. b. State the follow-up procedures you would perform for each fluctuation to determine whether a material misstatement exists. 8-34 (OBJECTIVES 8-3, 8-4) Coca Cola Co. and PepsiCo Inc. are chains of soft drinks and bev- erage products industry that cater to customers who desire soft drink and beverage goods at certain prices. The Securities and Exchange Commission (SEC) Form 10-K filing rules require management of American public companies to include background information about the business, as well as the most recent financial condition and results of opera- tions. Access each company's most recent Form 10-K. These can be obtained through the SEC Web site (www.sec.gov), or directly from the investor relations section of the Coca Cola Co. (www.coca-cola.com) and PepsiCo Inc. (www.pepsico.com) Web sites. husiness in Part I. Item 1 of Form 10-K and Required 8-33 (OBJECTIVE 8-4) In the audit of the Worldwide Wholesale Company, you did extensive ratio and trend analysis as part of preliminary audit planning, Your analytical procedures 1. Commission expense as a percent of sales was constant for several years but has in- creased significantly in the current year. Commission rates have not changed. 2. The rate of inventory turnover has steadily decreased for three y
