Question 1

Determine if your friend has enough money to pay for emergencies by answering the following related to theLiquidity Ratio

1. ndicate which of the items from the above table that you will use to compute this ratio and which report that each item originated from (i.e. budget and/or balance sheet).
2. Calculate this ratio by showing all of your work.
3. Assuming that it would be desirable to fund at least 3-6 months of living expenses in the event of an emergency, does your friend have enough money available to meet this goal?

CategoryAmount

Debt Payment (with mortgage)$1,800 per month

Debt Payment (without mortgage)$750 per mont

Expenses$2,600 per month

Income - Gross$4,800 per month

Income - Disposable$3,700 per month

Monetary Assets$15,000

Total Assets$75,000

Total Debt$55,000

Total Net Worth$20,000

Question 2

A range of stakeholders have been identified who managers should consider when determining the entity's sustainability performance and reporting during the COVID-19 pandemic.

Determine how managers should engage with any three stakeholders and document what sustainability issues they would be likely to discuss during this engagement process with specific reference to the issues faced by companies during the COVID-19 pandemic.

Question 3

Sunrise Solar Inc. (SSI) is a medium-size company that is developing solar energy systems for private residences and small businesses. It is privately owned, with the majority of the shares held by the company's president, Shu Mingfei. Started up two years ago, to date, it is mostly involved in research and development, but this year it completed its first customer sales and installation. Shu has engaged your firm to do the current year's audit because she plans to obtain $20 million in debt financing from outside investors to allow further commercialization of the SSI systems. You are now reviewing SSI's preliminary general ledger trial balance in order to begin preparing the audit planning. The following is a summary of the accounts that appear in this trial balance as at year-end:

Cash $101,209

Accounts receivable 85,019

Allowance for bad debts (15,000)

Inventory, finished goods 900,550

Inventory, work in process 44,666

Inventory, raw material 67,890

Deferred development costs 34,445

Property, plant and equipment 3,700,990

Accumulated amortization, PPE (901,108)

Patents, at costs 1,010,000

Accounts payable (198,009)

Warranty provision (30,000)

Shareholder loan, non-interest bearing (11,000,000)

Share capital, common shares (1,000)

Retained earnings 1,364,767

Revenue (812,202)

Cost of goods sold 666,502

General and administration expenses 1,002,500

Research and development expenses 3,990,000

Other expenses 89,990

REQUIRED:

c.) Discuss users, qualitative characteristics. Apply a range of at least three quantitative calculations and make a recommendation for planning materiality consistent with your qualitative discussion and key users.