Which of the following is not a benefit of emerging audit technologies?
A. The potential to dramatically enhance the effectiveness and the value of the external audit.
B. Remove the challenge of junior auditor work and make that work less interesting.
C. Automate much of the more tedious work that auditors perform.
D. Leave more time for auditors to better understand the businesses they are auditing the underlying risks related to financial reporting.
Answer: B
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National Storage Company had sales of $1,000,000, sales discounts of $2,500, sales returns and allowances of $15,000, and cost of goods sold of $525,000. Calculate National's gross profit.
What will be an ideal response?
A local newspaper devotes its New Year's Day issue to people who have performed heroically during the past year. One of the people included in the article was Janet, a local actress. Eight months earlier, a fire started in the theater while she was in
the middle of a performance. Rather than running out, she stayed to help frightened members of the audience get out of the theater. The New Year's article stated that Janet had been unable to find work as an actress because of burns to her hands and feet and that, as a result, she owes a great deal of money. Janet sued the newspaper for invasion of privacy. Based on what you have learned in this chapter, how should the case be decided?
Division Y has asked Division X of the same company to supply it with 5,000 units of part L763 this year to use in one of its products. Division Y has received a bid from an outside supplier for the parts at a price of $33.00 per unit. Division X has the capacity to produce 20,000 units of part L763 per year. Division X expects to sell 18,000 units of part L763 to outside customers this year at a price of $34.00 per unit. To fill the order from Division Y, Division X would have to cut back its sales to outside customers. Division X produces part L763 at a variable cost of $25.00 per unit. The cost of packing and shipping the parts for outside customers is $2.00 per unit. These packing and shipping costs would not have to be incurred on sales of the parts to Division Y.Required:a. What is
the range of transfer prices within which both the Divisions' profits would increase as a result of agreeing to the transfer of 5,000 parts this year from Division Y to Division X?b. Is it in the best interests of the overall company for this transfer to take place? Explain. What will be an ideal response?
The median is a measure of
a. relative dispersion b. absolute dispersion c. central location d. relative location