Yuna Kim, CPA, was recently hired to audit Sochi Inc.'s financial statements for the fiscal year ending December 31, 2014. She then continued to conduct test of controls related to conducting test of controls of the expenditure (acquisition and disbursements) activities after acquiring an understanding of the client's accounting and internal control structures and their operation.

The following example pertains to the spending cycle's test of controls:

Yuna Kim intends to analyze cash disbursement by selecting a sample using systematic selection with a random start. What is the primary value of this kind of selection?

In addition, the client's materials-purchasing period starts with requisitions from user agencies and ends with the receipt of materials and acknowledgment of a liability. What is the primary aim of this cycle's review?

The division controller's office presented Yuna Kim with a schedule listing the creditors and the amount owed to each at December 31, 2014, after auditing the client's accounts payable balance of one of the client's divisions. What is the most efficient audit method for ensuring that no account payables are absent from the schedule?

The company's disbursements are processed by an automated accounts payable system. The internal auditor of the company needs to match the accounts payable balance in the firm's month-end trial balance report to the master account payable file on magnetic tape. What are the right auditing methods to use in this situation?

Yuna Kim also intends to investigate the client's obtaining reports. Why is this required?

#3 - 20 points: Consider a 2-person, 2-good economy. Endowments and utility functions are: el = (1,2) , u (x, y) = mintc, y} = (3,2) , u (x, y ) = cty Draw a carefully labeled Edgeworth box diagram showing: a) endowments b) indifference curves through the endowments c) the set of allocations that both agents prefer to the endowmentsQuestion 2: Consider a country producing milk and cookies using labor and capital as inputs described by a Heckscher-Ohlin model. The following table provides outputs for goods and factor endowments before and after a change in the endowments. Output and Endowments Initial After Endowment Change Milk Output, QM 100 gallons 1 10 gallons Cookie Output, Qc 100 pounds 80 pounds Labor Endowment, L 4000 hours 4200 hours Capital Endowment, K 1000 hours 1000 hours a) Calculate and rank the magnification effect for quantities in response to the endowment change. b) Which product is capital intensive? Show why. c) Which product is labor intensive? Show why.13 Using the Accounting Codes, bulk food paid for by state Child Nutrition Program funds would be recorded as * (1 Point) 12-0000-3700-4700 12-5310-5000-8590 13-5310-3700-4700 13-3010-5000-4300 14 Using the Accounting Codes, revenue requiring no special tracking used to pay the salary of a Data Entry Technician in the central Adult Education office would be recorded as * (1 Point) O 11-0000-2100-2200 11-0090-3700-2200 11-1100-2100-2200 11-1100-3700-2200A list of the accounts of Medford Corporation is given below. followed by some selected transactions. Indicate the accounts that should be debited and credited for the transaction or adjusting entry by placing the appropriate account codes in the debit and credit columns provided. [10 points) Code Account Code Account A. Cash I. Common stock B. Prepaid expenses J. Retained earnings C. Accounts receivable K. Rent revenue D. Service trucks L. Service revenue A l t d E. \"um? a e M. Expenses depreciation Dividends F. Accounts 3 able N. p y payable G. Notes payable 0. Utility Payable H. Unearned revenue P. Rent payable Transaction or . Debit Credit Closing entry Purchased a service truck for ' $50,000. paid in cash. Paid $600 for a two-year ' insurance policy covering the truck. Collected $1,000 in advance for provided next yean ' dividend. $2,000. Depreciation of ' truck must be recorded. Truck insurance used for one full recorded (see 1, March 5 elections the DM will attract a following as a dollar alternative, but the following is based on its historical attractions and weight: it is more of a Pavlovian reaction than the choice of careful analysis. The German election was between Helmut Kohl of the conservative Christian Democratic Party and Hans-Jochen Vogel, a former mayor of Munich and the leader of the Social Democrats. A major part of the election campaign centered on whether U.S. Pershing II and cruise missiles should be stationed on German soil. The Kohl forces generally favored continued close links with NATO and the U.S. military, while Vogel demanded that the U.S. and Soviets sign an arms agreement that would make it unnecessary for NATO to install the Pershing and cruise missiles. Since U.S. missiles were involved, Turner speculated that the turn of the election might influence the direction of the Deutschemark/dollar exchange rate. However, he knew he would have to make a decision before the election. The four alternatives described by the banker were as follows: 1. Hedge in the Forward Market In the forward market one sells marks for dollars, or vice versa, today, at a fixed price, with delivery to be accomplished at some future date, such as within one, three, or six months. The advantage of the procedure that Turner would be assured of a fixed number of dollars when the mark sales proceeds were received. Turner noted that the three-month forward price was DM24153/3 and the six-month price was DM2.3945/5. meaning that more dollars would be received per mark in the future than at present. The banker explained that this was because interest rates and inflation in Germany at that moment were below comparable U.S. rates. She reported that the German bank prime rate was 12.0% while the U.S. bank prime was 15.0%, Three-month and six-month government bill rates were 10.0% in Germany and 13.6% in the United States, 2. Hedge in the Money Market Beverly Wu explained that her bank would be able to arrange for Culver Radio to borrow marks from a bank in Germany. The rate charged would be one percentage point above the German bank prime. Should Turner want, he could borrow marks in Germany today, exchange those marks for dollars at once in the spot market, and in three or six months use the mark sales proceeds to repay the German loans. 3. Hedge with Foreign Currency Options In December 1982 the Philadelphia Stock Exchange began trading in foreign currency options. Options were available in five currencies and in multiples of standard sized contracts: Deutschemarks DM 62.500 per contract Swiss francs 62.500 per contract British pounds f 12,500 per contract Canadian dollars CS 50,000 per contract Japanese yen 6,250,000 per contract A person wanting to buy an option on $50,000, for example, would purchase four contracts: $50,000/$12.500 = 4 contracts. Foreign currency options expire on the Saturday preceding the third Wednesday of the expiration month, and expiration months are March, June. September, and December. Thus all contracts for June 1983 expire on June 11, 1983; and all September 1983 contracts INTL FRANCE. CATE ADORN