You Are Required To Audit Fashion Designers Limited, A Subsidiary Company Of Las Vegas
You are required to audit Fashion Designers Limited, a subsidiary company of Las Vegas Group Corporation (USA) Limited. Fashion Designers Ltd is a large multi-national manufacturer and distributor of fashion accessories. The company is listed on the New York Stock Exchange and its major shareholder (51%) is the US Company which controls the use of the accessory brand names throughout the world. Fashion Designers Ltd operates predominantly out of Australia but is rapidly expanding into Asia and Eastern Europe. In 1992 overseas operations accounted for 15% of the group turnover and 10% of the Group profit. In 1993 this is expected to increase to 23% of turnover and 18% of profit. As the American market is considered to be stagnant, future growth is expected to come from the Asian and European markets. The audit structure is such that all overseas operations are audited by the same international audit firm, XYZ
What Are The Main Sources Of Value Of Financial Institutions (banks)? And Which Financial
What are the main sources of value of financial Institutions (banks)? And which financial Institutions are using the fair market value accounting? Explain
The Following Data From The Just Completed Year Are Taken From The Accounting Records
The following data from the just completed year are taken from the accounting records of Mason Company: Sales $ 654,000 Direct labor cost $ 82,000 Raw material purchases $ 130,000 Selling expenses $ 105,000 Administrative expenses $ 47,000 Manufacturing overhead applied to work in process $ 204,000 Actual manufacturing overhead costs $ 224,000 Inventories Beginning Ending Raw materials $ 8,400 $ 10,200 Work in process $ 5,900 $ 20,500 Finished goods $ 77,000 $ 26,000 Required: 1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials. 2. Prepare a schedule of cost of goods sold. Assume that the company’s underapplied or overapplied overhead is closed to Cost of Goods Sold. 3. Prepare an income statement.
Suppose Your Firm Is Considering Investing In A Project With The Cash Flows Shown
Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 7 percent, and that the maximum allowable payback and discounted payback statistics for the project are 3.5 and 4.5 years, respectively. Time: 0 1 2 3 4 5 6 Cash flow: −$5,100 $1,240 $2,440 $1,640 $1,560 $1,440 $1,240 Use the payback decision rule to evaluate this project
Solvency Means: A) Corporation Should Be Able To Pay Its Debts As They Become
Solvency means: a) Corporation should be able to pay its debts as they become due b) Corporation’s assets fairly valued should exceed liabilities after distribution payments are made
“Crazy” Connor Cooper Is A Somewhat Eccentric Yet Enthusiastic Businessman Who Believes In The
“Crazy” Connor Cooper is a somewhat eccentric yet enthusiastic businessman who believes in the social responsibility of business. Incidentally, he is also interested in making enough money to live a comfortable life. As a supporter of the ecology movement, he is very concerned with the hunting of animals for industrial purposes, such as the making of furs, shoes, and ladies’ handbags. As a consequence, he formed Reptile Factory Enterprise (RFP), a company with a mission of promoting crocodiles as household pets. (The choice of the animal was purely coincidental.) He plans to catch crocodiles in Southeast Asia and sell them in the United States.1 The senior leadership team of the company consists of Mr. Connor Cooper (President), Brian Chu (Vice President of Production, who is in charge of catching crocodiles), Marco Diaz (Vice President of Sales), and Shelley Maze (Vice President of Operations, who is in charge of administrative functions including cash collection from customers). Facilities Planning The first task facing Mr. Cooper was to raise capital. This required estimating future capital needs by projecting the physical facilities and working capital needed for the business. Mr. Cooper’s estimates showed that he would need a fleet of boats to catch crocodiles in Southeast Asia and a holding tank in the State of Gould to keep them alive in captivity after they are shipped. Because of the need to extend liberal credit terms to skeptical customers, the company needed working capital to carry inventories and receivables. Finally, the company needed a large start up investment for sales and an advertising campaign. The firm also needed funds to hire new employees and to rent office space in the State of Gould. Mr. Cooper asked Shelley Maze to prepare a forecast of activity to plan facility needs and to translate it into capital needed to start the business. First Year Results Based on the forecast provided by Ms. Maze, Mr. Cooper and his ecology minded friends raised the capital for acquiring the facilities. He leased ten boats in Southeast Asia, a 20,000 square foot warehouse with a holding tank for the crocodiles in the State of Gould, and a 2,500 square foot office in the State of Gould. Both the warehouse and the office were leased from Clyde Property Management (CPM) for three years, beginning January 1, 2008. The company opened its door for business on January 1, 2008. Marco Diaz launched an aggressive sales and advertising campaign built around the slogan that crocodiles were warm, friendly and greatly misunderstood creatures that deserved loving care. He designed a slick marketing campaign built initially around the slogan: “Crocodiles — don’t handbag them, handle them with love.” During its first year, the company spent approximately $300,000 to catch 500 crocodiles. Of these, 300 crocodiles were sold and shipped to customers at a selling price of $1,000 per crocodile. Shipping costs of $50 per crocodile were paid for during the year. Customers were given liberal credit terms and only $160,000 from an equivalent 200 customers was collected during the first year. Ms. Maze estimated that as much as 20% of the sales price will be spent in collection costs and bad debts expenses. At the end of the first year, Mr. Cooper consulted with his other two colleagues and estimated that he could catch and sell 600 to 800 crocodiles for the next year. Because of the company’s apparent success, Mr. Cooper wanted to expand its facilities. This meant getting funds to rent more boats and warehouse space. He believed that he could now overcome the skepticism of banks and ask for a loan. On January 2, 2009, Mr. Cooper notified Clyde Property Management that he no longer needed their current warehouse and office space. He would be vacating the properties by January 30th in order to move into larger facilities. 1 Assume that Mr. Cooper has somehow managed to obtain permits to sell live crocodiles legally. He asked Ms. Maze to prepare an income statement for the bank in accordance with generally accepted accounting principles (GAAP). In addition, since the executives were on a profit-sharing scheme, it was necessary to determine profits in order to pay year-end bonuses. Ms. Maze entrusted this task to her young staff accountant, Luis Norman, who had only recently graduated from college and was on his first job. After he familiarized himself with the facts, Norman realized that he needed to look up the GAAP accounting rules for preparing an income statement. At that same moment, he also realized with some consternation that he had sold his college accounting textbook when the course was over. Norman headed to his college library to find the relevant reference material. A review of his old accounting textbook told him that two GAAP principles were particularly relevant for his current task. The first was the matching principle, which requires that costs and revenues be matched by time periods. The other was the principle of revenue recognition. His next step was to copy and read the relevant sections of these principles from the pronouncements of the Financial Accounting Standards Board. Attachment 1 shows the results of Norman’s research into the appropriate GAAP rules for preparing income statements. On first reading the material, Norman thought it was going to be easy to prepare an income statement. He remembered learning that for most businesses’ revenue was earned when good were sold (that is, when title passed from the seller to the buyer). However, as he read the statements of the FASB, he realized that revenues could be recognized when production was complete or when cash was collected. According to the FASB standard, “revenues are considered to have been earned when the entity has substantially accomplished what it must do to be entitled to the benefits represented by the revenues.”2 Norman realized that in order to determine the revenues for 2008, he must first determine when the earning process is complete. This, however, was not a usual business. Therefore, Norman was not sure when Reptile Factory Enterprise was “entitled to the benefits represented by the revenues”. In order to determine the critical point in the operations cycle when the business could do this, he decided to talk to the three top executives. His first conversation was with Brian Chu, V.P. Production. Brian told him that catching crocodiles was the most critical activity for the business since “it is difficult to trap them suckers and you can lose a few limbs in the process if you are not careful.” Norman next spoke to Marco Diaz, V.P. Sales. Marco pointed out that while catching may be a dangerous activity, no one is likely to buy a crocodile because it is risky for us to catch them. He felt the company’s success this year was largely due to his clever holiday season advertising campaign with its theme of: “this year give that special someone something live! Someday they can produce their own shoes, handbags, and belts.” Norman’s final conversation was with Shelley Maze, V.P. of Operations. She told Norman that, in her opinion, the crucial activity for the business was cash collection. As she put it: “Brian and Marco have never tried collecting cash. If they did, they would find out in a hurry that it is difficult to collect cash from people who keep crocodiles as pets. Besides, we don’t have a collection agency that is willing to repossess live crocs!” 2Financial Accounting Standards Board, Statement of Concepts # 5, Paragraph 83. The Lawyers Call Even as Norman was puzzling over how to proceed, he received a call from Ms. Shelley Maze. “Luis, I just heard from our lawyers. Apparently, Clyde Property Management (the property management company that leased us the warehouse and office space) is claiming that we had no right to break the lease. We are being sued for an amount equal to the balance of the lease term and for punitive damages. Later that day Luis received the memo from the lawyers. Assume that you have been hired as a consultant by Shelley Maze to help her an
d Luis Norman. She has asked you for your help on the GAAP income statements and the legal issues arising from the lease cancellation. Please answer the following questions: 1. Compute the net income per crocodile assuming that only one crocodile was caught, sold, and collected on in this year. Assume the costs of shipping the 500 crocodiles from Southeast Asia to the State of Gould is part of the $300,000 cost of catching them. The $50 shipping cost is the cost of shipping each crocodile from the holding tank in the State of Gould to the customer. 2. a. Prepare three income statements for the year assuming that revenue is to be recognized when: Crocodiles have been caught (i.e. production complete). Crocodiles have been sold and delivered Cash collections are complete b. What income would you report for 2008? Why? 3. What compensatory damages, if any, are owed to Clyde Property Management? 4. What punitive damages, if any, are owed to Clyde Property Management? 5. Show the journal entry to record the legal liability arising from the potential lawsuit. (If you find there is no liability, show the entry needed if there were liability)
For The Year Ended December 31, 2018, Carla Co. Reported Pretax Financial Income Of
For the year ended December 31, 2018, Carla Co. reported pretax financial income of $292,912. Its current tax payable was $52,637. Carla reported a difference between pretax financial statement income and taxable income. This difference is due to accelerated depreciation for income tax purposes. Carla’s income tax rate is 21% and Carla made no estimated tax payments during 2018. What amount did Carla report as taxable income for 2018?
What Are Tax Clienteles? Give An Example. Why Might We Not Observe Tax Clienteles
What are tax clienteles? Give an example. Why might we not observe tax clienteles in practice?
For The Year Ended December 31, 2018, Carla Co. Reported Pretax Financial Income Of
For the year ended December 31, 2018, Carla Co. reported pretax financial income of $228,176. Its current tax payable was $59,445. Carla reported a difference between pretax financial statement income and taxable income. This difference is due to accelerated depreciation for income tax purposes. Carla’s income tax rate is 29% and Carla made no estimated tax payments during 2018. What amount of accelerated depreciation did take in 2018?
Malone Corporation Reports Pretax Accounting Income Of $381,700, But Due To A Single Temporary
Malone Corporation reports pretax accounting income of $381,700, but due to a single temporary difference, taxable income is only $281,800. At the beginning of the year, no temporary differences existed. Assume a tax rate of 20% What is Malone’s net income?
Larner Corporation Is A Diversified Manufacturer Of Industrial Goods. The Company’s Activity-based Costing System
Larner Corporation is a diversified manufacturer of industrial goods. The company’s activity-based costing system contains the following six activity cost pools and activity rates: Activity Cost Pool Activity Rates Labor-related $ 7.00 per direct labor-hour Machine-related $ 3.00 per machine-hour Machine setups $ 40.00 per setup Production orders $ 160.00 per order Shipments $ 120.00 per shipment General factory $ 4.00 per direct labor-hour Cost and activity data have been supplied for the following products: J78 B52 Direct materials cost per unit $ 6.50 $ 31.00 Direct labor cost per unit $ 3.75 $ 6.00 Number of units produced per year 4,000 100 Total Expected Activity J78 B52 Direct labor-hours 1,000 40 Machine-hours 3,200 30 Machine setups 5 1 Production orders 5 1 Shipments 10 1 Required: Compute the unit product cost of each product listed above. (Do not round intermediate calculations. Round your answers to 2 decimal places.) J78 B52 Unit product cost
Prepare The Adjusted Trial Balance From Problem #2. Prepare The Financial Statements From The
Prepare the Adjusted Trial Balance from problem #2. Prepare the Financial Statements from the Adjusted Trial Balance: a. Income Statement b. Equity Statement c. Balance Sheet
What Are Tax Clienteles? Give An Example. Why Might We Not Observe Tax Clienteles
What are tax clienteles? Give an example. Why might we not observe tax clienteles in practice?
Comprehensive Master Budget: ABC Costing Operating
please finish all the questions and use excel to do it
I Can’t Check My Answers In The Book And Want To Make Sure My
I can’t check my answers in the book and want to make sure my answers are correct
Under What Circumstances Would You Advise An Owner Or Manager Of More Than One
under what circumstances would you advise an owner or manager of more than one trading business to trade under a single ABN umbrella
What Advice Might The ATO Provide In Regards To Legislation Related To Taxes Reported
What advice might the ATO provide in regards to legislation related to taxes reported on activity statements?
Alden Company Manufactures Tables. The Beginning Balance Of Raw Materials Inventory Was P5,500: Raw
Alden Company manufactures tables. The beginning balance of Raw Materials Inventory was P5,500: raw material purchases of P31,500 were made during the month. At month end, P8,200 of raw material was on hand. Raw material used during the month was Select one: a. P39,200 b. P28,800 c. P31,500 d. P37,000
Handcrafts Inc. Manufactures To Customer Order Using The Job Order Cost System. For The
Handcrafts Inc. manufactures to customer order using the job order cost system. For the month just ended, it registered the following data: Beginning work in process: P300,000 Cost of Orders completed: 2,400,000 Cost of Orders shipped: 2,000,000 Materials issued for the month: 1,700,000 Direct labor cost: 800,000 Factory overhead rate: 150% of direct labor cost The ending work in process inventory was: Select one: a. P1,400,000 b. P1,600,000 c. P500,000 d. P700,000
Assume That Management Expects 500 Machine Hours In May. Using The High-low Method, Calculate
Assume that management expects 500 machine hours in May. Using the high-low method, calculate May’s power cost using machine hours as the basis for prediction. Select one: a. P710 b. P700 c. P705 d. P1,320
May Date 1 Collected $1900cash From Customer Accounts Receivable. 2 Purchased Supplies On Account
May Date 1 Collected $1900cash from customer accounts receivable. 2 Purchased supplies on account that cost $360. 7 Recorded services of catering to customers. Cash receipts were $610, and invoices for services on account were $1800. 8 The catering job was completed that was paid for in advance on April 9. 10 Paid the utility company for the monthly utility bills that had been received in the previous month, $340. 15 Paid $1800cash for employee salaries. 15 Purchased a one-year insurance policy for $1200on the refrigerator. 16 Paid $220on the account payable that was established when supplies were purchased on May 2. 20 Paid a $400cash dividend to the stockholders. 27 Received monthly utility bills amounting to $360. The bills would be paid in the month of June. 31 Recorded revenues to customers. Cash receipts were $900, and invoices for sales on account were $1400. 31 Paid $1800cash for employee salaries. Required: a. Record the transactions in the general journal. b. Open general ledger accounts, using the T-accounts provided, and post the general journal entries to the ledger. c. Record and post the appropriate adjustingentries. d. Prepare an adjusted trial balance. e. Prepare an income statement, statement of retained earnings, and balance sheet for May.
PLACE THIS ORDER OR A SIMILAR ORDER WITH SMASHING ESSAYS
The post You Are Required To Audit Fashion Designers Limited, A Subsidiary Company Of Las Vegas appeared first on Smashing Essays.
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"
