You are engaged to perform an audit of the Giordani Corporation for the year ended December 31, 2013. You have decided to perform the following cutoff test for payables and accruals. Select all items greater than $25,000 for two business days before and after year-end from the purchases journal and ensure that all transactions are recorded in the proper period. During your rms observation of Giordanis physical inventory you obtained the following cutoff information: the last receiving report number in 2013 was 49,745. Your audit work identied the following items for fur-ther investigation:

Selections from the December 2013

Purchase Journal Date RR# Vendor Name Amount Explanation

a. 12/30 49,742 Allen Chem. $29,875 Chemicals purchased for manufacturing process.

b. 12/31 none Khan Consulting $45,000 Payment for consulting services for the three-month period beginning December 1, 2013. The $45,000 was charged to consulting expenses.

c. 12/31 49,744 Goff Materials $205,000 Raw materials used in the manufacturing process. Selections from the January 2014 Purchase Journal DateRR#Vendor NameAmountExplanation

d. 1/01 49,746 Temper Trucks $75,985 Purchase of a new forklift.

e. 1/02 49,743 Pack Products $42,000 Paper products used in manufacturing process.

f. 1/02 none Telecom Inc. $32,450 December 2013 telephone bill.

Required: For each of the six items provided in the table above, consider whether there is evidence of proper cutoff of payables and accruals (i.e., the transaction is recorded in the proper period). If the item is not properly recorded, prepare the necessary adjusting entries at December 31, 2013.