What is the role of the Sarbanes-Oxley Act of 2002 in relation to the types of internal controls used by corporations

ACC 290 Week 5 Assignment

Answer the following summary question: What is the role of the Sarbanes-Oxley Act of 2002 in relation to the types of internal controls used by corporations such as those illustrated in Exercises 7-4, 7-5, and 7-6?

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Contrast these types of bonds

Contrast these types of bonds:
(a) Secured and unsecured.
(b) Convertible and callable.


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Various types of "accounting changes" can affect the second reporting standard of the generally accepted auditing standards

Auditing P 3-31

Various types of "accounting changes" can affect the second reporting standard of the generally accepted auditing standards. This standard reads, "The auditor must identify in the auditor's report those circumstances in which such principles have not been consistently observed in the current period in relation to the preceding period." Assume that the following list describes changes that have a material effect on a client's financial statement for the current year:
1. Correction of a mathematical error in inventory pricing made in a prior period.
2. A change from prime costing to full absorption costing for inventory valuation.
3. A change from presentation of statements of individual companies to presentation of consolidated statements.
4. A change from deferring and amortizing preproduction costs to recording such costs as an expense when incurred because future benefits of the costs have become doubtful. The new accounting method was adopted in recognition of the change in estimated future benefits.
5. A change from the completed-contract method to the percentage-of completion method of accounting for long-term construction contracts.
6. A change in the estimated useful life of previously recorded fixed assets based on newly acquired information.
7. A change to including the employer share of Social Security (FICA) taxes as "retirement benefits" on the income statement from including it with "other taxes."
8. A change from FIFO method of inventory pricing to the LIFO method of inventory pricing.

Identify the type of change described in each item above, and state whether any modification is required in the auditor's report as it relates to the second standard of reporting. Organized your answer sheet as shown. For example, a change from the LIFO method of inventory pricing to the FIFO method in inventory pricing would appear as shown.
Assume that each item is material.

Item No. Type of Change Should Auditors report be modified?
Example An accounting change from one GAAP "Yes" to another GAAP


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Eight different types of evidence were discussed

Auditing P 7-32

Eight different types of evidence were discussed. The following questions concern the reliability of that evidence:
a. Explain why confirmations are normally more reliable evidence than inquiries of the client.
b. Describe a situation in which confirmation will be considered highly reliable and another in which it will not be reliable.
c. Under what circumstances is the physical observation of inventory considered relatively unreliable evidence
d. Explain why recalculation tests are highly reliable but of relatively limited use.
e. Give three examples of relatively reliable documentation and three examples of less reliable documentation. What characteristics distinguish the two
f. Give several examples in which the qualifications of the respondent or the qualifications of the auditor affect the reliability of the evidence.
g. Explain why analytical procedures are important evidence even though they are relatively unreliable by themselves.


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GASB Statement 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, does not apply to which of the following investment types

MULTIPLE CHOICE

1. GASB Statement 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, does not apply to which of the following investment types?

2. In the Statement of Net Assets for proprietary funds, GASB requires a classified format where current assets, noncurrent assets, current liabilities and noncurrent liabilities are presented:

3. Funds that are used to account for activities similar to those often engaged in by profit-seeking businesses are:

4. The operations of agency funds will be included in which of the following statements?


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GAMMA produces over a hundred different types of residential water faucets as its Delta, Florida plant

GAMMA produces over a hundred different types of residential water faucets as its Delta, Florida plant. This plant uses activity–based costing to calculate product costs. The following table summarizes the plant's overhead for the year and the cost drivers

Used for each activity center:
Summary of plant Overhead and Activity Centers
Total cost
(millions Activity center of dollars)
Cost driver Amount of cost Activity cost per unit Driver of cost drive
Materials handling $20.8 Direct materials $130 million $ 0.16
Purchasing 13.8 part numbers 800 $17,250
Set-up labor 6.8 Batches 500 $13,600
Engineering 10.9 Number of products 125 $87,200
Occupancy 16.2 Direct labor $ 90 million $0.18
----------------
Total plant overhead $ 68.5
----------------

One faucet model GAMMA manufactures is Explorer .Its total product cost is as follows:
Direct labor $ 121,700
Direct materials 90,500
Materials handling $ 90,500 $ 0.16 14,480
Purchasing 9 17,250 155,250
Setup ; 8 13,600 108,800
Engineering 1 87,200 87, 200
Occupancy $121,70 0 $0.18 21,906
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Total cost $599,836

Number of units manufactured 12,500
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Product cost per unit $ 47.99
----------------------

Required Question:
Calculate the product cost per unit of the Explorer faucet using absorption costing where plant overhead is assigned to products using direct labor dollars.

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(Accounting Organizations and Documents Issued) Presented below are a number of accounting organizations and types of documents they have issued

CA1-11 (Accounting Organizations and Documents Issued) Presented below are a number of accounting organizations and types of documents they have issued.

Instructions
Match the appropriate document to the organization involved. Note that more than one document may be issued by the same organization. If no document is provided for an organization, write in “0.”

Organization
1. _____ Accounting Standards Executive Committee
2. _____ Accounting Principles Board
3. _____ Committee on Accounting Procedure
4. _____ Financial Accounting Standards Board

Document
(a) Opinions
(b) Practice Bulletins
(c) Accounting Research Bulletins
(d) Financial Accounting Standards
(e) Statements of Position

Click here for the solution: (Accounting Organizations and Documents Issued) Presented below are a number of accounting organizations and types of documents they have issued