Price Based On Latest Purchase Invoice Price

4. Speculate on what will happen at IKEA stores as they are adapted to fit local tastes. Is the company’s trade-off of service for low cost sustainable in the long term?

Revenue would be the new base that would be used to determine materiality. Total assets is another good alternative, however this company does not have many operating assets (only inventory and PPE are the significant accounts)

Answering this question requires knowledge of three terms. The three terms are absolute amounts, materiality, and percentage analysis. The text defines absolute amounts as the absolute dollar amount of a given trend (Edmonds, Tsay, & Olds, 2011). For example, if a company had a net income amount of $400,000 in a given year, it could be reported in its absolute dollar amount of $400,000. The relative importance of the information defines materiality. An item is considered material if knowledge of it would influence the decision of a reasonably informed user (Edmonds, Tsay, & Olds, 2011). For example, a net income amount of $400,000 may be extremely material to a new start-up business; however, a $400,000 expense may immaterial to a 10-billion-dollar company like FedEx. Percentage analysis involves computing the percentage relationship between to amounts (Edmonds, Tsay, & Olds, 2011).

This week, you are going to complete an Assignment in which you analyze two case studies. You will read each case and answer the questions included using the information you have gained from this course so far. Your answer should include an analysis of client strengths, possible interventions, and a reflection on the possible ethical issues and cultural influences as they might impact the case.

C. If you decide to use the work of a valuation specialist to audit the estimate of fair value, describe your responsibilities with respect to using the specialist’s work.

The client wants to know if you will be present at the year-end inventory. What is your decision and why? What role or actions will you take at the inventory if you decide to attend the inventory. Why?

I would discuss with the supervisor and coworkers about how much percentage of the inventory should be valuated so that auditors can conclude that the inventory has no material discrepancies. And also, I will negotiate with the client in order to have a little more time to finish required valuation of inventory. Since I believe that providing unqualified and faithfully represented financial reports is an essential mission of an accounting firm, and that the investors and governmental authority consider CPAs and auditors should be responsible for the quality of financial reports (the punishment is quite harsh for not doing a good job), I would intend to sacrifice more time and costs for more accurate financial information.

Which of the following is not one of the typical questions to ask prior to inviting a supplier into the design process as presented in the book?

1. I learned how to utilize information from Factiva to understand the challenges facing my client’s industry and how to tailor audit procedures accordingly

Discuss how REA diagrams might be useful to auditors in understanding a client’s business processes. What if the client hasn’t prepared them in advance? What basic steps would the auditor perform to compile the information necessary to build he diagram himself or herself? Does that time investment produce large enough benefits to the auditor? Explain your answer.

We need to gather information about the formula the management used in coming up with the inventory obsoletion percentage and determine if the amount to be written-off is appropriate.

5. Reflect on this process. Your reflection does not need to be limited to the following questions but make sure to at least address each of these questions. Was it difficult to analyze the assumptions and biases that might be present? Did using the design questions help you? Which design questions seemed most useful, were any of them not useful? Can you identify any of your own assumptions or biases in the modifications you suggested in part 4

Analyze more fully the product that does not meet your expectations. Write a paragraph about each of the following:

First, Penny needs to follow the boss’s request. At the same time, she requires to protect interest of her colleagues. But, as a professional accountant, she has to be guided by accounting standard and provide fairly presented information to auditors. Accounting Standards Update (ASU) No.2015-11 states that companies should account for inventory by using lower of cost or net realizable value. When evidence exists that the net realizable value of inventory is less than its cost, entities need to recognize the difference as a loss in earnings. So, according to this accounting requirement, Penny should record inventory at lower net realizable value. Moreover, code of ethic for professional accountant has explicit regulation to the accountant. A professional accountant’s responsibility is not exclusively to satisfy the needs of an individual client or employer. For the public interest, a professional accountant should be straightforward and honest in all business relationships, and not allow undue influence to override business judgments. In addition, an accountant should comply with the regulations and laws and avoid any action that discredits the

The fair value measurement of inventory is difficult to measure since it is based on the price that would be received to sell the inventory. This method creates the need for a hypothetical value to be assigned until the actual sell of the inventory occurs. (Robin