Stock categorized as trading securities is purchased for $72,000 . At year end, when the market value of the stock is $63,000, the adjusting entry that would be recorded is:
a. Allowance to Adjust Short-Term Investments to Market 9,000
Unrealized Loss on Investments 9,000
b. Unrealized Loss on Short-Term Investments 9,000
Allowance to Adjust Short-Term Investments to Market 9,000
c. Allowance to Adjust Short-Term Investments to Market 9,000
Short-Term Investments 9,000
d. Realized Loss on Investments 9,000
Short-Term Investments 9,000
B
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In addition to evaluating the frequency of deviations in tests of controls, an auditor should also consider certain qualitative aspects of the deviations. The auditor most likely would give broader consideration to the implications of a deviation if it was:
A. caused by an employee's oversight. B. initially concealed by a forged document. C. identical to a deviation discovered during the prior year's audit. D. the only deviation discovered in the sample.
The PCAOB's second fieldwork standard requires auditors develop an understanding of the client's controls as an important prerequisite to developing specific audit tests
a. True b. False Indicate whether the statement is true or false
Flower Company had beginning inventory of $19,000, purchases were $100,000, and ending inventory had a cost of $25,000 and a market value of $20,000 . Which of the following is/are not true?
a. Cost of Goods Sold is $5,000 larger when the firm records ending inventory at lower of cost or market than when it records the inventory at acquisition cost. b. The loss of $5,000 increases Cost of Goods Sold by $5,000 and therefore reduces net income by $5,000, compared to the acquisition cost basis. c. The firm should disclose the existence of large write-downs included in Cost of Goods Sold in the notes so that users of financial statements understand the components of the Cost of Goods Sold account. d. The firm should disclose the existence of large write-downs included in Cost of Goods Sold in Managements' Discussion and Analysis so that users of financial statements understand the scope of the asset impairment. e. none of the above
Which of the following is an annual award administered by the U.S. Commerce Department's National Institute of Standards and Technology (NIST)?
A. Presidential Award for Management Excellence B. Firestone Inner Circle of Quality Award C. ISO 9000 certification D. Baldrige Performance Excellence Program