Types of Audit Opinions On January 2, 2014, the Zoom Detail Shoppe received notice from its primary supplier that all wholesale prices were being increased by 10%, effective immediately. Based on this notice, Zoom revalued is December 31, 2013 inventory
to reflect the higher costs. The inventory is a large proportion of the total assets. The effect of the revaluation was material to current assets, but not to total assets or net income. The increase is adequately disclosed in the footnotes. REQUIRED: Which type of audit report would you suggest be issued this year and why?
This is a failure to follow GAAP and a qualified opinion should be issued. Zoom Detail Shoppe has used a replacement cost inventory approach rather than a lower of cost or market approach. It is most likely not sufficiently material to require an adverse opinion.
You might also like to view...
A contract that has been fully performed is an executory contract.
Answer the following statement true (T) or false (F)
A leading question is a question used to guide an interviewer through a survey by directing the interviewer to different spots on the questionnaire depending on the answers given
Indicate whether the statement is true or false
In a period of declining prices, which of the following inventory methods generally results in the lowest balance sheet figure for inventory?
A) LIFO B) Cannot tell without more information C) FIFO D) Average-cost
A company, such as Nike, can have no affect on the work environment in a foreign country
Indicate whether the statement is true or false