Answer:
1. When searching for unrecorded liabilities, the auditors consider transactions recorded <u>after</u> year end.
<em>Auditors consider transactions recorded after year end to determine if it was supposed to be recorded in the current period. </em>
2. Accounts payable <u>confirmation</u> can be mailed to vendors from whom substantial purchases have been made.
<em>As a way to keep a document trail, creditors from whom substantial goods were bought from can be mailed a confirmation. </em>
3. To gain overall assurance as to the reasonableness of accounts payable, the auditor may consider <u>ratios</u>.
<em>Ratios such as the Payables turnover can be used to evaluate the reasonableness of Accounts payable. </em>
4. When auditors find unrecorded liabilities, before adjusting they must consider <u>materiality</u>.
<em>
They must consider if the adjustment is material or significant enough to record. </em>
5 Auditiors need to consider <u>shipping terms</u> terms for determining ownership and whether a liability should be recorded.
<em>Shipping terms need to be considered because they can tell who owns goods in transit and therefore if a liability is needed for them. Shipping terms such as FOB Shipping point mean that the business incurs the liability as soon as the seller ships the goods. </em>
Answer and Explanation:
The Journal entry is shown below:-
September 9
Petty cash fund Dr, $400
To Cash $400
(Being establishment of petty cash fund is recorded)
Here we debited the petty cash fund as assets is increasing while we credited the cash is decreasing.
September 30
Merchandise Inventory Dr, $51
Postage expense Dr, $73
Cash Short and over Dr, $13
Miscellaneous Dr, $141
To Petty Cash $278
(Being reimburse of petty cash find is recorded)
Here we debited the merchandise Inventory, postage expense, cash short and over and miscellaneous as it is expenses while we credited the petty cash as is reimbursed.
October 1
Petty cash fund Dr, $60
($460 - $400)
To Cash $60
(Being increase in petty cash fund is recorded)
Here we debited the petty cash fund as assets is increasing while we credited the cash is decreasing.
Answer:
The interest payable is calculated based on the principal, interest rate, number of years of the loan or of the deposit.
Explanation:
Financial institutions is a company or a firm that deals with financial and monetary activities such as; loans, deposits, investments and currency exchange. Most financial transactions especially loans and savings usually have an interest rate that is set by the financial institution. The amount of interest can be paid by the borrower in a case where an individual takes a loan from the financial institution. Interest can also be paid by the financial institution in a case where the individual or group opens a savings account with the financial institution. In both cases, the interest rate is set by the financial institution. The amount of interest payable can be determined using the formula below;
A=PRT
where;
A=amount of interest payable
P=principle amount. The principal amount can either be the loan amount or the savings deposit amount
R=interest rate
T=number of years
The interest payable is calculated based on the principal, interest rate, number of years of the loan or of the deposit.
Answer:
A) production is determined by the interaction of supply and demand.
Explanation:
A pure market economy is an economy where production decisions are made by the forces of demand and supply. there is no intervention of the government in production decisions
Characteristics of a pure market economy
- Private ownership of means of production
- freedom of choice. Producers are free to produce what they desire
- competition among producers
- no government intervention.
Hello, The first step of financial planning process is to define specific goals. Since this is the first step I figured it is the most important.
Hope this helps..
