The owner of the candy and snack manufacturing company, Boyac Tostadita S.A., has asked him to investigate possible problems with the company's payroll. They have given you the Income Tax Return for this year and the previous year and two files with the payroll information. The file called "HR Master File" contains information about each employee. The file called "Payroll" shows in detail the payroll corresponding to 5 periods of this year. You will perform some audit procedures for Boyac Tostadita S.A. and you will analyze the results obtained.

Review the Income Statement of the owner of Boyac Tostadita S.A. based on the AICPA Code of Professional Conduct, how to proceed to address the owner's concerns, and what specific steps will be taken to audit this business.

Please include the amounts from the income statements in the corresponding steps.

Example in the evaluation, Understand the processes, Review the human resources master file and data, Test the controls and transactions, etc.

Need references

BoyacStadita S.A.
Income statement
For the year ending December 31,			2020	2019
Net sales (minus discounts and returns)			$8,353,542	$7,998,832
Cost of Goods Sold					3,745,623	3,621,532
Gross Profit					4,607,919	4,377,300
Operating Expenses:
Advertising					115,325	113,452
Bad debt expenses				65,232	62,585
Depreciation and amortization			75,210	73,565
Rates & Subscriptions				600	575
Sure					60,800	60,600
Licenses & Fees				300	285
Marketing & Promotion				52,632	51,025
Dining & Entertainment				25,030	24,345
Office Expenses					14,325	14,652
Office Supplies					24,003	23,458
Wages and salaries				2,380,105	2,192,032
Professional Rates				39,700	38,500
Property Taxes					19,220	19,000
Lease						85,230	84,360
Repairs & Maintenance				1,450	1,500
Shipping & Delivery				770	730
Travel expenses					75,830	73,560
Services					35,230	34,250
Equipment Leasing					44,000	43,750
Other						15,320	14,756
Total Operating Expenses				3,130,312	2,926,980
Operating income					1,477,607	1,450,320
Interest expense					84,658	83,950
Other income (interest, royalties)			5,920	5,725
Pre-tax income					1,398,869	1,372,095
Income Taxes					489,604	480,233
Net Income					$ 909,265	$ 891,862