You are the auditor of Heavy Metal Manufacturing Company, a small manufacturer of specialty parts used in various manufacturing processes. You are performing a search for unrecorded liabilities. Suppose you have the following information: Amount Owed Accounts Payable Listing as of December 31, 2021 Vendor Type of Vendor Invoice # Due Date Acquisition Jones Supply Inventory 65001 01-09-2022 Metal Customwerks Inventory 99831 01-10-2022 Sophisticated Catering Party 241 01-10-2022 Calumet Controls Inventory 5409 01-14-2022 Business First Supplies 7117306 01-14-2022 Ace Fabricating Inventory 9974 02-22-2022 $70,000 90,000 17,500 8,300 2,400 84,200 $262,400 Check # 8719 8720 8721 8722 8723 8724 8725 8726 Cash Disbursement for January 2022 Date Payee Purpose 01-06-2022 Jones Supply Inventory 01-07-2022 Metal Customworks Inventory 01-08-2022 Delectable Catering Party 01-11-2022 Calumet Controls Inventory 01-11-2022 Organized Office Supplies 01-11-2022 Business First Supplies 01-15-2022 Alumex Supply Inventory 01-15-2022 Steel Fixtures Inventory Amount $70,000 70,000 17,500 8,300 15,500 2,400 9,700 35,000 Receiving Report # R9121 R9122 R9123 R9124 R9125 R9126 R9127 R9128 Receiving Reports Before and After December 31, 2021 Date Vendor Description Received 12-26-2021 Jones Supply Inventory - 60 units part # B450 12-27-2021 Metal Customworks Inventory - 100 units part # B178 12-27-2021 Calumet Controls Inventory - 500 units part # C703 12-30-2021 Organized Office Supplies - 500 boxes computer paper 12-30-2021 Ace Fabricating Inventory 70 units part # 398 12-31-2021 Business First Supplies - 100 printer cartridges 01-02-2022 Alumex Supply Inventory - 250 units part # Z190 01-03-2022 Steel Fixtures Inventory - 200 units part # Z347 Also, you discuss the holiday party with Delectable Catering and learn that this party did take place on December 23, 2021 and was for all the employees and their families. A. Do you see any problems? If so, what are these problems? B. What, if any, are your concerns about unrecorded liabilities? C. What should you do now? If an adjusting entry is to be proposed, show what that entry would be. Assume all amounts are material. You are the auditor of Heavy Metal Manufacturing Company, a small manufacturer of specialty parts used in various manufacturing processes. You are performing a search for unrecorded liabilities. Suppose you have the following information: Amount Owed Accounts Payable Listing as of December 31, 2021 Vendor Type of Vendor Invoice # Due Date Acquisition Jones Supply Inventory 65001 01-09-2022 Metal Customwerks Inventory 99831 01-10-2022 Sophisticated Catering Party 241 01-10-2022 Calumet Controls Inventory 5409 01-14-2022 Business First Supplies 7117306 01-14-2022 Ace Fabricating Inventory 9974 02-22-2022 $70,000 90,000 17,500 8,300 2,400 84,200 $262,400 Check # 8719 8720 8721 8722 8723 8724 8725 8726 Cash Disbursement for January 2022 Date Payee Purpose 01-06-2022 Jones Supply Inventory 01-07-2022 Metal Customworks Inventory 01-08-2022 Delectable Catering Party 01-11-2022 Calumet Controls Inventory 01-11-2022 Organized Office Supplies 01-11-2022 Business First Supplies 01-15-2022 Alumex Supply Inventory 01-15-2022 Steel Fixtures Inventory Amount $70,000 70,000 17,500 8,300 15,500 2,400 9,700 35,000 Receiving Report # R9121 R9122 R9123 R9124 R9125 R9126 R9127 R9128 Receiving Reports Before and After December 31, 2021 Date Vendor Description Received 12-26-2021 Jones Supply Inventory - 60 units part # B450 12-27-2021 Metal Customworks Inventory - 100 units part # B178 12-27-2021 Calumet Controls Inventory - 500 units part # C703 12-30-2021 Organized Office Supplies - 500 boxes computer paper 12-30-2021 Ace Fabricating Inventory 70 units part # 398 12-31-2021 Business First Supplies - 100 printer cartridges 01-02-2022 Alumex Supply Inventory - 250 units part # Z190 01-03-2022 Steel Fixtures Inventory - 200 units part # Z347 Also, you discuss the holiday party with Delectable Catering and learn that this party did take place on December 23, 2021 and was for all the employees and their families. A. Do you see any problems? If so, what are these problems? B. What, if any, are your concerns about unrecorded liabilities? C. What should you do now? If an adjusting entry is to be proposed, show what that entry would be. Assume all amounts are material
