Question
You are auditing Accounts Receivable of HUSKY Corp. as of December 31, 2013. The Accounts Receivable general ledger balance is $4,263,919.52. Access the textbooks resources
You are auditing Accounts Receivable of HUSKY Corp. as of December 31, 2013. The Accounts Receivable general ledger balance is $4,263,919.52. Access the textbooks resources on the Cengage website. The files are labeled HUSKY Unpaid Invoices 2013 (the 12/31/2013, unpaid invoices), HUSKY Shipping File 2013 (contains the shipment numbers and shipment dates for those invoices), and HUSKY Credit Limit 2013 (contains each customers credit limit). Sales are made FOB shipping point. The auditor has verified that the last shipment in 2013 is numbered 62050 and that shipping numbers have been used in proper sequence.
- Foot the file of unpaid invoices using the menu option Analyze, then Statistical, then Statistics and agree to the general ledger. Print the statistics for the audit documentation and note the other statistics provided.
- Identify customers with balances over their credit limit and print out the results. (Hint: Before combining files, be sure the matching fields, such as CUSTNUM or INVNUM, have been changed in each table from a number format to ASCII format using the menu item Edit then Table Layout. Double click on the field you want to change).
- Perform a sales cutoff test to identify any invoices for which sales were recorded in 2013 but shipment was not made until 2014 and print out the results, including the total of those invoices.
- Age the unpaid invoices as of December 31, 2013, print the aging and graph of the aging, extract (by double-clicking on the over 45 days aging indicator) and print out a list of invoices over 45 days old that also shows the total of those invoices.
- Summarize your results and describe what procedures should be performed based on those results. Use ACL to stratify the population of customer balances, print the results, and describe how this information could be used to help determine which balances to confirm.
NOTE: There is an ACL Appendix at the end of the textbook that you may find helpful in completing this problem.
PART II (90 pts)
Assume that you are auditing inventory of HUSKY Corp. as of December 31, 2013. The inventory general ledger balance is $8,124,998.66. HUSKY manufactures lawn and garden tractors, snowmobiles, and supplies. Download the data file labeled HUSKY Inventory 2013 from the books website under Student Resources. This file contains the following information:
SNUMB | Stock number (The first letter is Ffinished goods, Wwork in progress, Rraw material.) |
LASTSALE | Date of last sale (finished goods) or use (raw material) |
NUMSOLD | Number sold (finished goods) or used (raw materials) year-to-date |
UNITCOST | Unit cost |
INVQTY | Quantity on hand |
EXTCOST | Unit cost 3 Quantity on hand |
SELPRICE | Current selling price (finished goods only) |
REPLCOST | Current replacement cost (raw material only) |
Also, note that salespersons receive a 10% commission based on selling price.
- Using the menu option Analyze, choose Statistical then Statistics on the amount field, print the statistics, and agree the total inventory to the general ledger.
- Extract and print out all inventory items that have not been used or sold in six months. Include in the printout the total extended cost of those items.
- Extract the finished goods into a separate file (Hint: Use the expression SNUMB 5 = F):
- Extract those items that have a net realizable value less than cost. Add a column and calculate the amount each of those items that should be written down and print a report that includes those items and the total of the write-down.
- Add a field and calculate inventory turnover for each item in inventory. Extract and print a report of those items with a turnover less than 2. The report should include the total extended cost of those items.
- Extract the raw materials into a separate file (see hint in Part c, but replace F with R):
- Extract those items that have a replacement cost less than cost, add a column and calculate the amount each of those items that should be written down, and print a report that includes those items and the total of the write-down.
- Add a column and calculate inventory turnover for each item. Extract and print a report of those items with a turnover less than 2. The report should include the total extended cost of those items.
- Prepare a report of the audit implications of your findings, indicating any additional procedures that should be performed.
You are auditing Accounts Receivable of HUSKY Corp. as of December 31, 2013. The Accounts Receivable general ledger balance is $4,263,919.52. Access the textbooks resources on the Cengage website. The files are labeled HUSKY Unpaid Invoices 2013 (the 12/31/2013, unpaid invoices), HUSKY Shipping File 2013 (contains the shipment numbers and shipment dates for those invoices), and HUSKY Credit Limit 2013 (contains each customers credit limit). Sales are made FOB shipping point. The auditor has verified that the last shipment in 2013 is numbered 62050 and that shipping numbers have been used in proper sequence.
- Foot the file of unpaid invoices using the menu option Analyze, then Statistical, then Statistics and agree to the general ledger. Print the statistics for the audit documentation and note the other statistics provided.
- Identify customers with balances over their credit limit and print out the results. (Hint: Before combining files, be sure the matching fields, such as CUSTNUM or INVNUM, have been changed in each table from a number format to ASCII format using the menu item Edit then Table Layout. Double click on the field you want to change).
- Perform a sales cutoff test to identify any invoices for which sales were recorded in 2013 but shipment was not made until 2014 and print out the results, including the total of those invoices.
- Age the unpaid invoices as of December 31, 2013, print the aging and graph of the aging, extract (by double-clicking on the over 45 days aging indicator) and print out a list of invoices over 45 days old that also shows the total of those invoices.
- Summarize your results and describe what procedures should be performed based on those results. Use ACL to stratify the population of customer balances, print the results, and describe how this information could be used to help determine which balances to confirm.
NOTE: There is an ACL Appendix at the end of the textbook that you may find helpful in completing this problem.
PART II (90 pts)
Assume that you are auditing inventory of HUSKY Corp. as of December 31, 2013. The inventory general ledger balance is $8,124,998.66. HUSKY manufactures lawn and garden tractors, snowmobiles, and supplies. Download the data file labeled HUSKY Inventory 2013 from the books website under Student Resources. This file contains the following information:
SNUMB | Stock number (The first letter is Ffinished goods, Wwork in progress, Rraw material.) |
LASTSALE | Date of last sale (finished goods) or use (raw material) |
NUMSOLD | Number sold (finished goods) or used (raw materials) year-to-date |
UNITCOST | Unit cost |
INVQTY | Quantity on hand |
EXTCOST | Unit cost 3 Quantity on hand |
SELPRICE | Current selling price (finished goods only) |
REPLCOST | Current replacement cost (raw material only) |
Also, note that salespersons receive a 10% commission based on selling price.
- Using the menu option Analyze, choose Statistical then Statistics on the amount field, print the statistics, and agree the total inventory to the general ledger.
- Extract and print out all inventory items that have not been used or sold in six months. Include in the printout the total extended cost of those items.
- Extract the finished goods into a separate file (Hint: Use the expression SNUMB 5 = F):
- Extract those items that have a net realizable value less than cost. Add a column and calculate the amount each of those items that should be written down and print a report that includes those items and the total of the write-down.
- Add a field and calculate inventory turnover for each item in inventory. Extract and print a report of those items with a turnover less than 2. The report should include the total extended cost of those items.
- Extract the raw materials into a separate file (see hint in Part c, but replace F with R):
- Extract those items that have a replacement cost less than cost, add a column and calculate the amount each of those items that should be written down, and print a report that includes those items and the total of the write-down.
- Add a column and calculate inventory turnover for each item. Extract and print a report of those items with a turnover less than 2. The report should include the total extended cost of those items.
- Prepare a report of the audit implications of your findings, indicating any additional procedures that should be performed.
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