Chapter 13 (ACCT-410)
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Chapter 13 (ACCT-410)

Course Number: ACCT 410, Spring 2010

College/University: MD University College

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13 Chapter Health Care Providers and Colleges and Universities TRUE/FALSE (CHAPTER 13) 1. The statement of financial position of a not-for-profit health care organization should distinguish among unrestricted, temporarily restricted, and permanently restricted net assets. 2. Unlike businesses, not-for-profit health care providers often serve patients who they know will be unable to pay any portion of the amounts...

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Chapter 13 Health Care Providers and Colleges and Universities TRUE/FALSE (CHAPTER 13) 1. The statement of financial position of a not-for-profit health care organization should distinguish among unrestricted, temporarily restricted, and permanently restricted net assets. 2. Unlike businesses, not-for-profit health care providers often serve patients who they know will be unable to pay any portion of the amounts billed. 3. Private not-for-profit colleges and universities are subject to the same FASB standards as other notfor-profit entities. 4. Restricted funds of a not-for-profit nursing home are not available for current use; however, the income earned on the funds is available. 5. Charity care provided by a health care organization would be recorded in a contra-revenue account. 6. In a not-for-profit health care organization, the cost of malpractice must be accrued if it is either probable that impairment has occurred or if the amount of loss can be reasonably estimated. 7. In a public university setting, general administration and sponsored research are examples of revenues classified by source. 8. Long lived assets held by public universities are carried at cost, or fair value if donated. 9. Investments of a public college must be reported at fair value. 10. Prepaid health care plans that earn revenue from agreements to provide service record revenue when services are rendered. 11. Tuition revenue should be reported net of tuition discounts and scholarships. 12. In accounting for colleges and universities, related entities should either be disclosed in the Notes to the Financial Statements or reported as component entities, depending on the degree of control and economic interest. 13. Under GASB 39, colleges and universities are required to bring their affiliated medical organizations into their financial reports. ch13 Page 1 MULTIPLE CHOICE (CHAPTER 13) 1. Financial statements for Smith College, a church-supported college, should be prepared according to standards set by a) AICPA. b) FASB. c) GASB. d) Smith may choose any of the above. 2. For a not-for-profit hospital, which of the following financial statements is NOT required? a) Statement of financial position. b) Statement of activities. c) Statement of cash flows. d) Statement of functional expenses. 3. For a not-forprofit college or university, which of the following categories of net assets is NOT appropriate in its external financial statements? a) Unrestricted net assets. b) Temporarily restricted net assets. c) Permanently restricted net assets. d) None. All of the above are appropriate. 4. Katerah College, a private college, received a $1 million donation. The donor specified that the principal of her gift could never be used for program activities but the earnings on the principal must be used to provide scholarships to academically qualified students in the business school. The $1 million gift would increase which of the following categories of net assets? a) Unrestricted net assets. b) Temporarily restricted net assets. c) Permanently restricted net assets. d) Either (b) and (c). 5. Intermountain Hospital, a not-forprofit health care provider, issued $70 million in term bonds to finance construction of a new wing at its main hospital. Terms of the bond issue require that $5 million of the proceeds of the bond issue be invested in U.S. government securities. The $5 million must be held until maturity of the bonds. The $5 million will increase which class of net assets? a) Unrestricted net assets. b) Temporarily restricted net assets. c) Permanently restricted net assets. d) Either (b) or (c). ch13 Page 2 6. During the current year, Kayla University received a $50,000 gift from an alumna who specified that it must be used to pay travel costs for faculty to attend health care conferences in foreign countries. During the year the university spent $8,000 to support travel to a health care conference in Italy. The $8,000 disbursement will cause a NET decrease in which class of net assets? a) Unrestricted net assets. b) Temporarily restricted net assets. c) Permanently restricted net assets. d) Cannot be determined. 7. In 2006 St. Joe s Hospital received a $50,000 cash gift to be used to buy supplies and other items for the pediatric department of the hospital. In 2007, St. Joe s purchased puppets and other items to be used in explaining medical procedures to young children. The acquisition of the items causes a NET decrease in which class(es) of net assets? a) Unrestricted net assets only. b) Temporarily restricted net assets. c) Both unrestricted and temporarily net assets. d) Neither unrestricted nor temporarily restricted net assets. 8. Voluntary health and welfare organizations must also report expenses by a) Object. b) Function c) Natural classification. d) Budget code. Use the following information to answer Questions 9 and 10. Kale Hospital, a not-for-profit entity, received a pledge from a donor in support of a fund raising effort by the Hospital to finance construction of a new facility for cancer treatment. The donor promised to pay $1 million in equal annual installments of $100,000 over the next 10 years. The present value of the gift at the risk-free interest rate is $736,000. 9. The amount of unrestricted revenue that should be recognized by Kale in the year of the gift is a) $1 million. b) $736,000. c) $100,000. d) $0. 10. The amount of restricted revenue that should be recognized by Kale in the year of the gift is a) $1 million. b) $736,000. c) $100,000. d) $0. ch13 Page 3 Use the following information for Questions 11 and 12. Lane College Foundation is governed by a board, some members of which are appointed by the President of Lane College and some of which are elected by the alumni. It was created to solicit and accept donations on behalf of Lane College, a private not-for-profit college. Lane College and its Foundation are deemed to be financially interrelated. All funds collected by the Foundation must be used to support activities of Lane College. The Foundation Board can select which activities of Lane College it supports. Lane Foundation received a $1 million bequest from the estate of a 1940 graduate. 11. At the time the Foundation receives the donation, the Foundation should debit Cash for $1 million and credit what account for $1 million? a) Unrestricted revenue. b) Temporarily restricted revenue. c) Liability. d) No entry should be made by the Foundation. 12. At the time the Foundation receives the donation, Lane College should debit Asset $1 million and Credit what account for $1 million? a) Unrestricted revenue. b) Temporarily restricted revenue. c) Liability. d) No entry should be made by Lane College. 13. Sheridan Public School Foundation had available temporarily restricted gifts in excess of $200,000. The Foundation decided to invest this money temporarily until it needs the funds for the restricted purpose. The donors had made no specific stipulations regarding investment earnings but the Foundation board had voted to use the earnings on the projects for which the gift had originally been restricted. At year-end, the securities had a fair value of $200,500. The appropriate way to recognize the change in fair value is a) Debit Investment $500; Credit Unrestricted Revenue $500. b) Debit Investment $500; Credit Temporarily Restricted Revenue $500. c) Debit Investment $500; Credit Permanently Restricted Revenue $500. d) No entry should be made until the securities are sold. 14. An accountant has encountered a perplexing financial reporting issue related to the hospital for which she is preparing financial statements. The issue is not specifically addressed by FASB statements. To which of the following sources would the accountant probably look first for industry-specific guidance? a) GASB Statements. b) AICPA accounting and auditing guide, Not-for-Profit Organizations. c) AICPA accounting and auditing guide, Health Care Organizations. d) Pronouncements of the HFMA or AHA. ch13 Page 4 15. In prior years, a not-for-profit hospital received funds from a donor who restricted the use of those funds to providing nursing scholarships. During the current year $8,000 of scholarships were awarded. These scholarships should be reported a) As expenses in the unrestricted fund. b) As reductions in the revenue section in the unrestricted fund. c) As expenses in the temporarily restricted fund. d) As expenses in the permanently restricted fund. 16. During the current year, St. Mary s Hospital (a not-for-profit entity) earned, based on its normal billing rate, $1 million in patient service revenues. Many of these patients belong to a health plan that has an established pay schedule. Based on the specific services rendered to members of the plan, the hospital estimates that $.05 million will not be collectible from the plan or the patient. Some of the patients are Hospital employees. These employees are given a 50% discount on the services rendered. Employee discounts for the current year total $.01 million. Some of the patients are uninsured and the hospital estimates that, of the amount billed to the uninsured patients, $.2 million will not be collectible (bad debts). The amount of net patient service revenues for St. Mary s Hospital for the current year is a) $1 million. b) $.94 million. c) $.87 million. d) $.74 million. 17. A consortium of physicians agrees to provide services to the employees of a large County government. The agreement calls for monthly payments from the County to the consortium in the amount of $100,000 per month. County employees are not billed for services rendered by the consortium. All County employees are required to use the consortium under their health care program (any services rendered to County employees by other physicians are not covered under the health plan). During the month the consortium performed services for County employees for which it would have billed $85,000. The consortium referred patients to other health care providers for services they could not perform. The consortium estimates that patients will be billed $5,000 for those services. The amount of revenue that should be recognized for the month by the consortium is a) $100,000. b) $95,000. c) $85,000. d) $80,000. 18. A hospital estimates that, based on past experience, it will incur $5 million in malpractice claims as a result of services rendered in the current period. The hospital carries a malpractice insurance policy with a yearly $2 million deductible clause. The amount that should appear on its year-end financial statement as Claims Expense (Loss) should be a) $0. b) $2 million. c) $3 million. d) $5 million. ch13 Page 5 19. A hospital carried a 2-year malpractice insurance policy that allows for retroactive premium adjustments based on experience (claims actually incurred). The basic premium is $150,000, payable in advance. At the end of the first year the hospital estimates that it will have to pay an additional $40,000 in premiums as a result of claims filed in the current year and it estimates that it will incur additional premiums in the second year of $50,000 as a result of claims filed in the second year. The amount of insurance expense that should appear on the financial statements at the end of the first year should be a) $75,000. b) $115,000. c) $150,000. d) $240,000. 20. An accountant has encountered a perplexing financial reporting issue related to the private college for which he is preparing financial statements. The issue is not specifically addressed by FASB Statements. To what standards would the accountant first look for guidance? a) GASB Statements. b) AICPA accounting and auditing guide, Not-for-Profit Organizations. c) AICPA accounting and auditing guide, Audits of Colleges and Universities and/or AICPA SOP 74-8, Financial Accounting and Financial Reporting by Colleges and Universities. d) College textbooks. 21. Sponsors of not-for-profit health care organizations generally include: a) Universities b) Community Organizations c) Religious Organizations d) Any of the above 22. Current operating expenses of a public college may be classified by which of the following? a) Object classes b) Organizational Units c) Program functions d) All of the above e) Only B & C 23. A specialized health care facility normally purchases their medicine. However, this month a wealthy philanthropist donates the medicine. This medicine should be recorded at fair market value and should be credited to: directly a) Deferred b) Revenue Unrestricted Net Assets c) Nonoperating Gains d) Other Revenues ch13 Page 6 24. The Gulf Coast bank is holding $750,000 donation in an independent permanent trust with the investment income dedicated for use by the Coastal hospital for operating purposes. The $750,000 principal should be: a) Disclosed in notes to the financial statements of the hospital b) Reported as a permanently restricted net asset of the hospital c) Reported as non-operating revenue of the hospital d) Reported as an asset limited as to use by the hospital 25. Which of the following would normally be considered ongoing or central transactions for a not-for-profit hospital? a) Recovery room fees for surgical patients b) Room and board fees from patients c) Both of the above d) Neither of the above 26. The community hospital of Briarwood normally includes proceeds from sales of meals in their cafeteria as a) Ancillary service revenues b) Other revenues c) Deductions from dietary meal service expenses d) Patient service revenues 27. In accounting for health care organizations, restricted net assets are: a) Not available for current operating use; however, the income generated is available for current operating use. b) Not available unless the directors remove the restrictions. c) Restricted as to use only for board-designated purposes. d) Restricted as to use by the donor, grantor, or other source of the resources. 28. In the process of general purpose external financial reporting, a health care organization is required to present a) A separate statement of changes in equity, net assets, or fund balance b) A statement of operations c) A performance indicator only by for-profit entities d) Fund group information by a not-for-profit organization 29. Hospital revenue usually includes which of the following? Revenue from Unrestricted Gifts Educational Programs a) Yes Yes b) No No c) Yes No d) No Yes ch13 Page 7 30. The current rates of General Hospital provide that revenues should have been $5 million for the current year; however, only $3.8 million was actually collected due to allowances for charity care of $700,000 and discounts of $500,000 to third-party payors. What amount should General Hospital report as net health care services revenues in the statement of operations for the current year? a) $5 million b) $4.5 million c) $4.3 million d) $3.8 million 31. Which of the following criteria must be met for a public university to report affiliated organizations as component units? I. The university is entitled to access those resources II. The economic resources are significant to the component III. The economic resources received or held are almost entirely for the direct benefit of the university a) I only b) I & II only c) III only d) II only e) I, II, & III 32. Although it no longer applies to external financial reporting, AICPA 1973 Audit and Accounting Guide for Colleges and Universities provides which of the following in the fund structure a) Plant funds b) Loan funds c) Annuity funds d) All of the above ch13 Page 8 PROBLEMS (CHAPTER 13) 1. St. Anthony s hospital is a private not-for-profit entity that provides health care services to the citizens in the small rural community in which it is located. The most recent construction at the Hospital was financed using Hill-Burton funds. During the current month, St. Anthony s engaged in the following transactions. Using the following information, make the appropriate entries for St. Anthony's for the current month. a. The Hospital would have billed $1.2 million for services rendered to its patients. The $1.2 million is based on the hospital s established billing rate. Of this amount $800,000 will be billed to Delta Medical Group, a third-party payor that insurers many state employees, $150,000 will be billed to uninsured patients, $200,000 is provided to indigents and will be considered charity care, and $50,000 was for services rendered to Hospital employees. b. Delta Medical Group pays for services rendered to its insurees on a rate schedule based on types of procedures rendered. For the services rendered during the current month to Delta insurees, Delta will reimburse the Hospital $780,000. Part of the agreement between St. Anthony s and Delta is that Delta insurees will not be billed for the difference between the amount Delta pays and the amount the Hospital bills. c. Based on prior experience with uninsured patients, the Hospital estimates that $60,000 of the $150,000 will be uncollectible. d. The Hospital provides a 50% discount for services rendered to its employees. e. The Hospital recognizes the value of charity services rendered. f. The Hospital is the defendant in a malpractice suit. Attorneys for the Hospital are reasonably sure the Hospital will be found liable and that the best estimate of the amount of the loss is $1,500,000. The Hospital carries medical malpractice insurance with a $500,000 deductible clause. g. The Hospital has numerous capital assets on its books. Straight-line depreciation on the assets is $150,000 for the current period. ch13 Page 9 2. Richards College is a not-for-profit college. Record the following transactions for Richards College. The College has a June 30, 2007 fiscal year. a. Tuition revenue for the Fall semester 2006(August - December) was $4 million; tuition for the Spring semester 2007 (January - May) was $3.8 million; tuition for the Summer semester 2007 (June 1-August 15) was $1 million. All tuition was received in cash. Faculty salaries for the Fall semester were $3 million; for the Spring semester, $2.9 million; for the Summer semester were $.5 million. All salaries are paid at the end of the month earned. Salaries earned in summer are June $0.2 million, July $0.2 and August $0.1 million. During June, $3.2 million of tuition applicable to the Fall 2007 was received in cash. During the year a wealthy benefactor pledged $1 million to the University for the fundraising campaign to renovate the oldest building on the campus. The benefactor will deliver the cash when renovation is substantially complete. Fixed assets of the University have a historical cost of $120 million, estimated salvage value of $20 million and an estimated useful life of 50 years. During the year the University s College of Business received notice of a $100,000 grant from the federal government to conduct a research project on the effect of different budgeting techniques on the performance of government employees. During the year the University spent $8,000 on printing questionnaires and $12,000 on faculty salaries for activities directly related to the grant. By year-end the University had not received any cash from the federal government. b. c. d. e. f. 3. In January 2006, the Free Cancer Foundation accepted an endowment of $500,000, the income from which is restricted to promoting research related to recovery from cancer. All gains, whether realized or unrealized are available for distribution. During 2006 the market value of endowment's investment portfolio increased to $520,000. Accordingly, at year-end $20,000 was credited to a temporarily restricted expendable fund. During 2007 the market value of the portfolio decreased to $470,000 and the foundation spent $12,000 on qualifying projects. Owing to these events and transactions, what should be the reported net asset balance of the following categories during 2007 (assuming a zero beginning balance in unrestricted net assets): 1. Permanently restricted 2. Temporarily restricted 3. Unrestricted ch13 Page 10 ESSAYS (CHAPTER 13) 1. Austin Community College, a government institution, issues stand-alone financial statements. Although the college maintains its accounts on a fund basis, it does not include a combined fund balance sheet or statement of revenues and expenditures in its financial statements. Can such practice be consistent with generally accepted accounting principles? Explain, citing specific GASB provisions or pronouncements. 2. How do the three major financial statements of a government hospital differ from a private not-for-profit hospital? 3. What are the key reporting hospitals available to government (public) colleges and universities? 4. How do the three major financial statements of a government (public) college/university differ from a (private) not-for-profit college/university? ch13 Page 11 ANSWERS TO TRUE/FALSE (CHAPTER 13) 1. T 2. T 3. T 4. F 5. F 6. F 7. F 8. T 9. T 10. F 11. T 12. T 13. T ch13 Page 12 ANSWERS TO MULTIPLE CHOICE (CHAPTER 13) 1. B 2. D 3. D 4. C 5. A 6. A 7. B 8. C 9. D 10. B 11. A 12. B 13. A 14. C 15. A 16. B 17. A 18. C 19. B 20. C 21. D 22. D 23. D 24. A 25. C 26. B 27. D 28. B 29. C 30. D 31. E 32. D ch13 Page 13 ANSWERS TO PROBLEMS (CHAPTER 13) Problem 1 a. Accounts Receivable Patient Service Revenue b. Patient Service Revenue Contractual Adjustments $1,000,000 $1,000,000 $ 20,000 Accounts Receivable-Allowance for Contractual Adjustments c. Bad Debt Expense $ 60,000 $ $ 60,000 25,000 20,000 Allowance for Bad Debts d. Patient Service Revenue Discounts $ 25,000 Accounts Receivable-Allowance for Employee Discounts $ e. No entry required. Note disclosure is required. The appropriate note disclosure explains the charity policies and reports the total value of the care provided. f. Claims Expense $ 500,000 Claims Liability g. Depreciation Expense Accumulated Depreciation $ 150,000 $ 500,000 $ 150,000 ch13 Page 14 Problem 2 a) Cash Revenue Deferred Revenue b) Salary Expense Prepaid Salary Cash Cash Deferred Revenue $8.8 million $7.8 million $1.0 million $5.9 million $ .2 million $6.1 million $3. 2 million $3.2 million c) d) A pledge may be recorded when pledged or when received, depending on the circumstances. This appears to be a conditional pledge and should not be recorded until the specified conditions are met. e) Depreciation Expense Accumulated Depreciation Printing expense Salary expense Cash Due from federal government Temporarily restricted revenue Revenue $ 200,000 $ 200,000 $ 8,000 $ 12,000 $ 20,000 $100,000 $ 80,000 $ 20,000 f) Problem 3 1. Permanently restricted $500,000 Temporarily restricted $0 Unrestricted $20,000 - $12,000 - $50,000 = ($42,000) 2. 3. ch13 Page 15 ESSAY ANSWERS (CHAPTER 13) 1. Yes. The college can report as a special purpose entity engaged only in business-type activities. Hence, it need not present fund statements. 2. Although both government and not-for-profit health care organizations are accounted for similarly, there are also significant differences. Not-for-profit hospitals have to follow the provisions of FASB Statement No. 117 as to the form and content of their financial statements. Hence the balance sheet of a not-for-profit hospital, but not that of a government hospital, must display the three categories of donor restrictiveness. Similarly, the statement of changes in net asset must indicate the amount of resources released from restriction and the statement of cash flow must be divided into three categories of receipts and disbursements (operations, financing and investing) rather than the four required of governments (operations, capital financing, noncapital financing and investing). 3. Government universities may elect to report as special purpose entities engaging (1) only in business-type activities, (2) only in governmental activities, or (3) in both. If they elect to report as a government engaging in both business-type and governmental activities, they will have to present the full range of fund and government-wide statements. If they elect to report as a special purpose government engaging only in governmental activities they need also present both fund and government-wide statements, but can combine the two. If they elect to report as a government engaging only in business-type activities as most government colleges and universities do then they need present only a statement of net assets, statement of revenues and expenses, and a statement of cash flow. These would have to be on a full-accrual basis. 4. The answer to this question is basically the same as that to question No.2. That is, the statements of a not-for-profit university must adhere to the FASB not-for-profit accounting provisions. Accordingly the statement of net assets and the statement of changes in net assets must report on the three categories of donor-restricted resources and the statement of cash flow must be presented in three, rather than four, categories. ch13 Page 16

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MD University College - ACCT - 410
14 Chapter Managing for Results TRUE/FALSE (CHAPTER 14) 1. Zero-based budgeting requires the periodic review of all programs, not just new ones. 2. It is difficult for accountants to have a role beyond auditing the financial statements of governments and
MD University College - ACCT - 410
15 Chapter Auditing Governments and Not-For-Profit Organizations TRUE/FALSE (CHAPTER 15) 1. A cognizant agency can be either an employee of a federal agency or of an independent accounting firm. 2. The Single Audit Act of 1984 was passed to eliminate the
MD University College - ACCT - 422
ACCT 422 Auditing Theory and Practice Midterm Examination Answers Due Date: On or before Sunday, March 21, 2010 @ 11:59 p.m. EST Instructions: This exam consists of 5 parts. Your answers to the exam questions should be submitted on a separate answer sheet
MD University College - ACCT - 422
ACCT 422 Auditing Theory and Practice Midterm ExaminationDue Date: On or before Sunday, March 21, 2010 @ 11:59 p.m. ESTInstructions: This exam consists of 5 parts. Your answers to the exam questions should be submitted on a separate answer sheet. Your a
MD University College - ACCT - 411
Name: Tommy Y. Choi Accounting 411 Mid-Term Spring 2010 Do not use colors to indicate your answer because colors dont print. Either bold or underline your answer. 1) The relationship between legal and ethical is: a. Legal requires more than ethical b. Eth
MD University College - ACCT - 422
Chapter 1 Practice Problems 1-14 a. 1-15 a. 1-16 a. (3) (2) b. b. (2) (3) c. c. (2) (4) d. d. (3) (3)The relationship among audit services, attestation services and assurance services is reflected in Figure 1-3 on page 13 of the text. Audit services are
MD University College - ACCT - 422
Chapter 2 Practice Problems 2-16 a. 2-17 a. 2-19 a. b. c. d. e. f. g. h. i. j. 2-20 a. (1) (2) b. b. (2) (1) c. c. (3) (2) d. d. (3) (3)Engagement performance Human resources Engagement performance Engagement performance Relevant ethical requirements Mon
MD University College - ACCT - 422
Solutions to Chapter 3 Practice Problems 3-23 a. 3-24 a. 3-25 a. 3-28(a) CONDITION 1. Scope of the audit has been restricted (b) MATERIALITY LEVEL Highly material (c) TYPE OF REPORT Disclaimer(2) (3) (2)b. b. b.(3) (4) (3)c. c. c.(3) (1) (3)COMMENT
MD University College - ACCT - 422
Solutions to Chapter 4 Practice Problems 4-8 The rules concerning stock ownership by partners and professional staff: A partner in the office of the partner responsible for an audit engagement cannot own stock in that audit client. A partner can own stock
MD University College - ACCT - 422
Chapter 7 Practice Problems 7-27 a. 7-28 a. 7-29 a. (2) (3) 1. 2. 3. 4. 5. 6. * * b. b. (1) (3) c. c. 7. 8. 9. 10. 11. 12. (4) (4) d. d. (4) (4) 13. 14. 15. 16. 17. 18. Internal External Internal External External ExternalExternal Internal External Exter
MD University College - ACCT - 422
Chapter 8 Practice Problems 8-25 a. 8-26 a. 8-27 a. 8-28 Audit Activities 1. Send an engagement letter to the client. 2. Tour the clients plant and offices. 3. Compare key ratios for the company to industry competitors. 4. Review managements controls and
MD University College - ACCT - 422
Solutions to Chapter 9 Practice Problems 9-22 a. 9-23 a. 9-24 a. (4) (1) (2) b. b. b. (4) (1) (3) c c. c. (1) (1) (1)9-29 Acceptable audit risk is a measure of how willing the auditor is to accept that the financial statements may be materially misstated
MD University College - ACCT - 422
Solutions to Chapter 10 Practice Problems 10-30 10-31 10-32 10-34 a. a. a. 1. (3) (3) (3) a. b. c. 2. a. b. c. b. b. b. (3) (2) (4) c. c. c. (4) (4) (4) d. d. d. (4) (2) (2)Adequate documents and records and independent checks on performance. Transaction
MD University College - ACCT - 422
Solutions to Chapter 11 Practice Problems 11-20 11-21 11-22 11-23 INFORMATION 1. Management has a strong interest in employing inappropriate means to minimize reported earnings for tax-motivated reasons. Assets and revenues are based on significant estima
MD University College - ACCT - 422
Solutions to Chapter 12 Practice Problems 12-17 12-18 12-20PERSON 1 a. b. c. Systems analyst Programmer Systems analyst Programmer Systems analyst Programmer Data control* PERSON 2 Computer a. a.(1) (1)b. b.(1) (3)c. c.(3) (2)d. d.(3) (3)PERSON
MD University College - ACCT - 422
Solutions to Chapter 13 Practice Problems 13-22 13-23 13-24a. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. TD of B TD of B AP T of C ST of T AP TD of B T of C TD of B T of C T of C b. Recalculation Documentation Analytical procedures Documentation Documentation An
MD University College - ACCT - 422
Solutions to Chapter 14 Practice Problems14-21 14-22 14-23 14-25a. a. a. 1.(4) (4) (4) a. b. c. a. b. c. a. b. c.b. b. b.(4) (3) (4)c. c. c.(3) (1) (2) d. (1)Test of control Existing sales transactions are recorded. (Completeness) Documentation Te
MD University College - ACCT - 422
Solutions to Chapter 16 Practice Problems 16-20 16-21 16-22 16-30 a. a. a. a. (4) (4) (2) b. b. b. (4) (2) (1) c. c. (2) (2)Yes, it is acceptable for the controller to review the list of accounts the auditor intends to confirm. The confirmations will be
MD University College - ACCT - 422
Solution to Chapter 18 Practice Problems 18-18 18-19 18-21a. TYPE OF TEST Both (test of authorization is a test of control) b. PURPOSE OF PROCEDURE To determine that the amount recorded in thea. a.(2) (3)b. b.(2) (3)c. c.(2) (1)QUESTION 1acquisi
MD University College - ACCT - 422
Solutions to Chapter 19 Practice Problems 19-17 19-18 19-19 19-20 19-23a. TYPE OF EVIDENCE USED Analytical procedure Confirmation b. TYPE OF PROCEDURE Analytical procedure Test of details of balances c. & d. OBJECTIVE(S) Not applicable Existence Complete
MD University College - ACCT - 422
Solutions to Chapter 20 Practice Problems 20-17 20-18 20-20TYPE OF TEST1. Substantive test of transactions 2. Test of control 3. Substantive test of transactions 4. Substantive test of transactions 5. Substantive test of transactions 6. Test of control
MD University College - ACCT - 422
Solutions to Chapter 22 Practice Problems 22-20 22-21 22-28a. PURPOSE OF CONTROL 1. To insure that records are properly maintained. 2. To insure that records are properly maintained. 3. To insure that the general ledger reflects the balance of supporting
MD University College - ACCT - 422
Chapter 1: The Demand for Audit and Other Assurance Services Chapter 1 introduces the concept of assurance services which are independent professional services that improve the quality of information for decision makers. Most assurance services can be pro
MD University College - ACCT - 422
Chapter 2: The CPA Profession You should be familiar with the types of CPA firms, the types of activities performed by CPA firms, and the structure and hierarchy of CPA firms, as discussed on pages 26 30 of the text. The American Institute of Certified Pu
MD University College - ACCT - 422
Chapter 3: Audit Reports Chapter 3 covers the types of reports/opinions an auditor can render during the audit of a companys financial statements. As discussed in Chapter 2, the requirement to render a report, and the general contents of the report, are s
MD University College - ACCT - 422
Chapter 4: Professional Ethics This chapter deals with professional ethics, independence, and the other requirements under the AICPA Code of Professional Conduct. The first part of Chapter 4 (pages 78 83) discusses, in general terms, the concept of ethics
MD University College - ACCT - 422
Chapter 5 Legal Liability This chapter deals with the legal environment in which CPAs practice, focusing on liability under both common law and statutory law. Both civil and criminal liability is discussed. A good place to start is to familiarize yourself
MD University College - ACCT - 422
Chapter 6 Audit Responsibilities and Objectives Chapters 6 13 present an overview of the audit process. Chapter 6 covers the 5 steps in developing audit objectives: (1) Understanding objectives of an audit of financial statements and the responsibilities
MD University College - ACCT - 422
Chapter 7 Audit Evidence The 3rd field work standard of GAAS requires the auditor to obtain sufficient and competent evidence through various methods. Some of the methods by which the auditor can obtain evidence are explicitly set forth in the standard (i
MD University College - ACCT - 422
Chapter 8 Audit Planning and Analytical Procedures The 1st field work standard of GAAS imposes on an auditor an obligation of adequately planning the audit. Chapter 8 discusses the steps involved in the audit planning process as well as the usefulness of
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Chapter 9 Materiality and Risk This chapter discusses the concepts of materiality and risk in the audit process. Materiality The importance of the concept of materiality is demonstrated by looking at the scope paragraph of the audit report, which provides
MD University College - ACCT - 422
Chapter 10 Section 404 Audits of Internal Control and Control Risk Chapter 10 deals with internal control and control risk and the auditors assessment of both. Internal control is defined as the policies and procedures designed by company management to pr
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Chapter 11 Fraud Auditing We were introduced to the concept of fraud in Chapter 6 in the context of the auditors responsibility with respect to detecting fraud. This chapter expands upon that introduction by discussing in some detail the responsibilities
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Chapter 12 Impact of Information Technology on the Audit Process This chapter discusses the integration of information technology into the accounting system, the enhancements and new risks associated with such integration, and the internal controls design
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Chapter 13 Overall Audit Plan and Audit Program Chapter 13 addresses the five types of tests that may be used by the auditor in developing his/her overall audit plan. In developing his/her audit plan, the auditor must consider both the benefits/shortfalls
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Chapters 14 and 16 Audit of the Sales and Collection Cycle: Tests of Controls and Substantive Tests of Transactions and Substantive Tests of Details of Balances (Accounts Receivable) Chapters 14 17 cover the application of the audit process to the Sales a
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Chapters 18 - 19 Audit of the Acquisition and Payment Cycle Last week, we covered the Sales and Collection cycle. This week we cover the Acquisition and Payment cycle. Chapters 18 19 cover this cycle in much the same way that the Sales and Collection cycl
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Chapter 20 Audit of the Payroll Cycle and Personnel Cycle The Payroll and Personnel cycle involves the employment of personnel to perform services, the payment of those employees, the withholding of taxes and other deductions, and the payment of withheld
American InterContinental University Dunwoody - MCS - 111
Management Control Systems SystemsWhat is Control ? WhatControlling is the measurement and Controlling correction of performance of activities in order to ensure that the planned objectives are accomplished. are Control, centres on the prevention and Co
Montana Tech - BTH - 1802
Introduction To Biotechnology Genetic Engineering The definition of Genetic engineering refers broadly to the process of directed manipulation of the genome of an organism, usually a specific gene as defined by Helen, K. and Adrianne, M. (2005). The main
University of Toronto - CHEM - 1101
AMATH/BIOL 382 Problem Set 1 Solutions1. One can begin by observing that equation two factors as 0 = 2ass (2 bss ). The case ass = 0 can be ruled out, since this cannot satisfy the rst equation. Thus bss = 2. Substituting into the rst equation gives 0 =
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AMATH/BIOL 382 Problem Set 1 Due January 22, 20101. Notes, chapter 1: Exercise 1.1.11. 2. Consider the chemical reaction network indicated in Figure 1 with rate constants as shown.k1 k3E FA Bk2C DFigure 1: Closed Network a) Write a set of six diere
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AMATH/BIOL 382 Problem Set 2 Solutions1. a) The full reaction mechanism is described by ds(t) dt de(t) dt dc(t) dt dp(t) dt = k1 s(t)e(t) + k1 c(t) = k1 s(t)e(t) + (k1 + k2 )c(t) k2 e(t)p(t) = k1 s(t)e(t) (k1 + k2 )c(t) + k2 e(t)p(t) = k2 c(t) k2 e(t)p(t
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AMATH/BIOL 382 Problem Set 2 Due February 3, 20101. Recall the derivation of the Michaelis-Menten description of an enzyme catalysed reaction (refer to Figure 1). If the back reaction C P + E is not assumed negligibly slow, theS+Ek1 k 1Ck2 k 2E+P.
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AMATH/BIOL 382 Problem Set 3 Solutions1. (i) Running the le # Assignment 3 Problem 2i s1=Vmax1-Vmax2*S1/(Km2+s1) s2=Vmax2*S1/(Km2+s1)-Vmax3*s2/(Km3+s2) # parameters par Vmax1=1,Vmax2=2,Vmax3=4,Km2=4,Km3=3 done yields steady state (s1 , s2 ) = (4, 1). (ii
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AMATH/BIOL 382 Assignment 3 Due February 12, 20101. Consider the metabolic chain indicated below. Take the reaction kinetics asv1S1v2S2v3v1 = Vmax1 Vmax2 s1 v2 = Km2 + s1 Vmax3 s2 v3 = Km3 + s2 You will investigate the sensitivity of the steady sta
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AMATH/BIOL 382 Computational Modelling of Cellular SystemsBrian Ingalls Applied Mathematics University of Waterloo bingalls@uwaterloo.ca December 28, 2009Contents1 Biochemical Reaction Networks 1.1 Chemical Reaction Networks . . . . . . . . . . . . . .
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1/6 CHEM350: Lecture 1-3, Jan 4, 6, and 8 2010 Review of gas behaviour (covered in previous courses) Reading in textbook: Chapters 1 (brief review) and 7 (properties of real gases) Ideal gas equation of state (relates the state variables of a gas):PV = n
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1/1 CHEM350: Lecture 4, Jan 11 2010 Gibbs free energy for nonideal gases (section 7.5 in textbook) We know from thermodynamics that the total differential for the molar Gibbs free energy G (T , P ) has the formdG = SdT + VdPfrom which we obtain the rela
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1/1 CHEM350: Lecture 5, Jan 13 2010 Gibbs free energy for nonideal gases (section 7.5 in textbook) (continued) Notice that G o (T ) in the previous expression is the ideal gas pressure at 1 bar. This means that the standard state of the nonideal gas is 1
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CHEM 350 Lecture 6, January 15, 2010 Relation between B2 (T ) and intermolecular interactions. We shall consider only the simplest case: that of a gas of lledshell [or 1 S state] atoms, such as He, Ne, Ar. If V (R) is the potential energy (energy of inter
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CHEM 350 Lecture 7, 8, and 9, January 18, 20, and 22, 2010 Introduction to Statistical Mechanics. There are two general approaches to the description of physical systems: i) Macroscopic: large units of matter; units mol, mmol, etc. mechanical variables: V
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CHEM 350 Lecture 10, January 25, 2010 Fluctuations (continued)The number of atoms on a given side varies from frame to frame though not by much these are local uctuations which occur even though our system is in equilibrium For a small number of particle
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CHEM 350 Lectures 11 and 12, January 27 and 29, 2010 Ensemble Averages. variable v : having M possible values v1 , v2 , , vM : corresponding probabilities p1 , p2 , , pM N systems in ensemble with variable v having value vr in Nr = N pr of them with so m
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CHEM 350 Lectures 13, 14, and 15 February 1, 3, and 5 2010 Statistical Description of a System of Particles. Microscopic arrangements of particles: called conguration, complexion, state (QM) for an isolated system, each quantum state is associated with an
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CHEM 350 Lectures 16, 17, and 18 February 7, 10, and 12 20101MOLECULAR PARTITION FUNCTIONS. Independent Subsystems. 2In all cases we shall be concerned with subsystems that are statistically independent, and in the following, we shall ignore any intera
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CHEM 350 Lecture 19, February 22 2010 Rotations. First let us review briey the quantum mechanical description of simple rotational motion for a rigid rotor: 22 J (, ) = Erot (, ) , 2 2Re2 Upon setting Re = I (the moment of inertia of the rotor), we obtai
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CHEM 350 Lectures 25-35, March 8, 10, 12, 15, 17, 19, 22, 24, 26, 29, 31 2010 Grahams law example: A: known molar mass B: unknown molar mass At xed T , and P , for a given hole size: mB rate of escape of A MB = = rate of escape of B mA MATime dependence
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Connection between molar volume and pressure expressions for the van der Waals equation of state The van der Waals equation is P= RT 1 a RT b a 2 1 + + 2 V 1 b/V V V V V RT a1 1 + (b ) + RT V Vwhere we have expanded in a power series and nd that a = (b )
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Chemistry 350 Assignment 3: Solutions November 1st 2005 Question 115.4Consider the following table of diatomic molecules and associated rotational constants: Molecule H35Cl 12 16 CO 39 KI CsI B (cm1) 10.59 1.93 0.061 0.024 !" (cm1) 2886 2170 200 120a)
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Chemistry 350 Assignment 4: Solutions November 21st 2005 Question 1Q18.1Why is the stoichiometry of a reaction generally not sufficient to determine reaction order? The order of a rate equation for a chemical reaction indicates the concentration depende