The purpose of Part I is to perform preliminary analytical procedures as part of the audit
planning process. You have been asked to focus your attention on two purposes of analytical
procedures: obtain an understanding about the client's business and indi
19. LO.2 During the year, Eugene had the four property transactions summarized below.
Eugene is a collector of antique glassware and occasionally sells a piece to get funds to
buy another. What are the amount and nature of the gain or loss from each of t
E 121: Securities held-to-maturity; bond investment; effective interest
Tanner-UNF Corporation acquired as a long-term investment $240 million of 6% bonds, dated July 1, on
July 1, 2013. Company management has the positive intent and ability to hold
36. LO.1, 2 Which of the following results in a recognized gain or loss?
o a. Kay sells her vacation cabin (adjusted basis of $100,000) for $150,000.
o b. Adam sells his personal residence (adjusted basis of $150,000) for $100,000.
o c. Carl's
50. LO.3 Adelene, who lives in a winter resort area, rented her personal residence for 14 days
while she was visiting Brussels. Rent income was $5,000. Related expenses for the year were as
Real property taxes $ 3,800
31.LO.2, 5Al is a medical doctor who conducts his practice as a sole proprietor. During
2013, he received cash of $280,000 for medical services. Of the amount collected,
$40,000 was for services provided in 2012. At the end of 2013, Al had accounts
E 201: Change in principle; change in inventory methods
During 2011 (its first year of operations) and 2012, Batali Foods used the FIFO inventory costing method for both financial reporting and tax purposes. At the beginning of 2013, Ba
E 142: Determine the price of bonds in various situations
Determine the price of a $1 million bond issue under each of the following independent
E 143: Determine t
P 151: Operating lease; scheduled rent increases
On January 1, 2013, Sweetwater Furniture Company leased office space under a 21-year
operating lease agreement. The contract calls for annual rent payments on December 31 of each
year. The payments ar
E 175: Determine pension plan assets
The following data relate to Voltaire Companys defined benefit pension plan:
($ in millions)
Plan assets at fair value jan 1
expected return on plan assets
actual return on plan assets
E 185: Issuance of shares; noncash consideration
During its first year of operations, Eastern Data Links Corporation entered into the following transactions relating to shareholders equity. The articles o
Prepare the appropriate journal en
E 192: Restricted stock award plan
On January 1, 2013, VKI Corporation awarded 12 million of its $1 par common shares to
key personnel, subject to forfeiture if employment is terminated within three years. On
the grant date, the shares have a market
1. The topic number for business combinations.
2. The topic number for related party disclosures.
3. The topic, subtopic, and section number for the initial measurement of internal-use software.
4. The topic, subtopic, and section number for the subsequen
Plus: Net Purchases
Goods Available for sales
Less: Cost of goods sold
Purchase of land
Demolition of old building
Architect's fees (for new building)
Legal fees for title investigation of land
Property taxes of land (for period beginning March 1, 2013)
Interest on construction loan
Salvageed material sold
E 163: Taxable income given; calculate deferred tax liability
Ayres Services acquired an asset for $80 million in
2013. The asset is depreciated for financial reporting
purposes over four years on a straight-line basis (no
residual value). For tax p
Gain on Sale of Investments
Cost of Goods Sold
General and Administrative Exepense
Income Tax Expense
LO 2 3.
Calculating Present Values. For each of the following, compute the present
LO 2 11.
Calculating Present Values. You have just received notification
1. LO.1 Priscilla was recently promoted and received a substantial raise. She talks to her tax adviser
about the potential tax ramifications. After making some projections, her adviser welcomes her
to the AMT club. Priscilla believes that it is unfair tha
(TCO 5) Which of the following is responsible for establishing a
private company's internal control?
Management and auditors
Committee of Sponsoring Organizations
(TCO 6) The distinction between physical examination of
assets and examination of documents is dependent on the
item being examined. If the object being examined has no
inherent value, the evidence is called
(TCO 4) To succeed in an action against the auditor, the client
must be able to show that
the auditor was fraudulent.
the auditor was grossly negligent.
there was a written contract.
there is a close causal connection between