Question 20. The amount of provisions that should be recognized at December 31, 2021 is?
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Question 20. The amount of provisions that should be recognized at December 31, 2021 is?
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- For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation’s liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier’s debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer’s credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation’s liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier’s debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer’s credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation's abilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier's debit balance of P30,000, On the other hand, the testing of the accounts receivable account revealed that a customer's credit balance of P50,000 was netted against the balance of the accounts receivable At December 31, 2021, EMPLEO declared a cash dividend at PO.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…
- For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation’s liabilities. The following information relates to the obligations of EMPLEO Corporation as of December 31, 2021: Accounts payable for goods and services purchased on open account amounted to P350,000 on December 31, 2021. This amount was gross of a supplier’s debit balance of P30,000. On the other hand, the testing of the accounts receivable account revealed that a customer’s credit balance of P50,000 was netted against the balance of the accounts receivable. At December 31, 2021, EMPLEO declared a cash dividend at P0.50 per share on its P10 par value ordinary share capital, payable at January 12, 2022, to shareholders as of December 31, 2022. At December 31, 2021, EMPLEO had 1,000,0000 issued ordinary shares and 800,000 oustanding ordinary shares. The company financed its receivables, dated November 1, 2021, by discounting its 180-day P400,000 accounts receivable to a bank on a with…You are assigned to do the audit the work for Howard Ltd for the calendar year 2019, you found some issues that you believe represent possible adjustments to the company’s books. In addition, there are other issues that need to be addressed. The matters include: Several credit memos that were processed and recorded after year-end relate to sales and account receivables for 2019. These total $42 000. Electricity and other utilities’ invoices received after the cut-off date $30,000 Inventory cut-off tests indicate that $35 000 of inventory received on 30 December 2019 was recorded as purchases and accounts payable in 2020. These items were included in the inventory count at year-end and were therefore included in ending inventory. On 15 December 2019, Howard Ltd declared a bonus issue of 2 000 shares with a par value of $100 000 of its ordinary shares, payable 25 January 2020 to the ordinary shareholders on record as in 30 December 2019. Howard Ltd has not established a reserve for…In connection with your examination of the financial statements of Bukel Inc. for the year ended December 31, 2021, you were able to obtain certain information during your audit of the accounts receivable and related accounts The December 31, 2021 balance of Accounts Receivable control accounts is P 788,000 The only entries in the Doubtful Accounts Expense were : A credit for P1,296 on December 2, 2021 because Company A remitted in full for the accounts charged off on October 31, 2021; and A debit on December 31 for the amount of the credit to Allowance for Doubtful Accounts The Allowance for Doubtful Accounts schedule is presented below: DEBIT CREDIT BALANCE January 1, 2021 P 14,632 October 31, 2021 Uncollectible Accounts Company A – P 1,296 Company B – P 3,280 Company C – P 2,256 P 6,032 8,600 December 31, 2021 P…
- You are an audit manager at Foyer & Associates and have been assigned to the audit of Modern Electrical Limited (MEL) for the year ending 30 June 2021. During the planning stage of the audit, you become aware of the following matters: a.MEL has significant loans from its bank. The bank has Indicated that it is concerned about MEL'S ability to meet specific loan covenants, particularly the return on total assets (net b. The aped trade accounts receivable listing indicates that the percentage of accounts receivable exceeding 90 days has jumped from 15 per cent to 37.5 per cent during the last 12 months. The credit manager hasindicated that the is because some of MEL'S Customers are currently'experiencing financial difficulty. This question.includos Part A and B part- a for each of the following scenerio describe briefly how this matter is a fraud audit risk factor in relation to mel's financial report.The fieldwork for the December 31, 2018 audit of Schmidt Corporation ended on March 17, 2019. The financialstatements and auditor's report were issued on March 29, 2019. In each of the material situations (1 through 5)below, indicate the appropriate action (a, b, c). The possible actions are as followsa. Adjust the December 31, 2018 financial statements.b. Disclose the information in a footnote in the December 31, 2018 financial statements.c. No action is required.The situations are as follows:________ 1. On March 1, 2019, one of Schmidt Corporation's major customers declared bankruptcy. The customer'sfinancial condition in 2018 was deteriorating and they owed Schmidt Corporation a large sum of money as of thebalance sheet date.________ 2. On February 17, 2019, Schmidt Corporation sold some machinery for its book value.________ 3. On February 20, 2019 a flood destroyed the entire uninsured inventory in one of Schmidt'swarehouses.________ 4. On January 5, 2019, there was a significant…Dibiasky Corporation is a trading company based in Laguna. The auditor in charge for 2020 audit is examining the company’s liabilities as part of their procedures. The following accounts as of December 31, 2020 are relevant in the tests being performed by the auditor: Accounts payable 1. The balance in the company’s accounts payable account as of December 31, 2020 is P600,000 and this was before any necessary year-end adjustments relating to the following: a) On December 31, 2020, the company has a P50,000 debit balance in its accounts payable to Mindy, a supplier, resulting from a P50,000 advance payment for goods ordered by the company. b) On December 28, 2020, the company purchased and received goods for P40,000, terms 2/10, n/30. The company records purchases and accounts payable at net amounts. The invoice was recorded and paid January 3, 2021. c) Goods were in transit to the company from a vendor on December 31, 2020. The invoice cost was P50,000. The goods were shipped f.o.b.…
- The auditors of Final Victory Ltd (FVL) have conducted an annual audit of the company after 31 December 2020, the accounting year end of the company. Up to 31 January 2021 (before the authorization date of the financial statements), two errors are discovered: i) inventories to the value of $9,750 that had been recognized as sold during 2019 was incorrectly included in inventories as at 31 December 2019. ii) money receipt from a customer with a value of $5,250 on 31 December 2019 for service to be delivered on 2 January 2020 was recognized as a revenue in 2019. The following financial statements of FVL for 2019 (as reported) and 2020 (draft) are available: Statements of Profit or Loss and Other Comprehensive Income for the year ended 31 December (Picture Following) The tax rate was 30% for 2019 and 2020. No dividends have been declared or paid. FVL has no items of other comprehensive income since the date of incorporation. Required: Prepare the extracts on statement of changes in…Consider the following material and independent situations (i) to (iii) below.In each situation, the following dates apply:• Balance date: 30 June 2021• Date of audit report: 16 August 2021• Audited financial report and audit report sent to shareholders: 23 August 2021• Annual general meeting: 30 September 2021(i) The client purchased raw materials that were received before the financial year end. The purchase was recorded based on its estimated value. The supplier’s invoice, received on 30 July 2021, showed that the cost was substantially different from the estimated value.(ii) On 10 August 2021, the directors signed a contract to upgrade the client’s airconditioning system. The first payment of $100,000 is due on 1 September 2021. Work will be completed by 30 June 2022, and the final contract payment will be made at that time.(iii) On 25 August 2021, the general manager informed you that on 18 August 2021 the directors decided to sell land that the client was holding as a long-term…Answer the following subquestion as a result of an audit: a. How much is the correct carrying value of the notes payable as of December 31, 2023? b. How much is the correct interest expense that Meekah should recognized in the December 31, 2023 statement of comprehensive income? c. How much of the note is reported in the non-current liability section of the December 31, 2023 statement of financial position?