Answer:
C. The coupon rate on these bonds would have been higher if Standard and Poor's, Moody's, and Fitch had assigned lower credit ratings
Explanation:
Assume that in January 2017, Vivendi announced a €1.2 billion bond issuance. The bonds have a coupon rate of 6.75% payable semiannually. Assume the bonds have been assigned credit ratings of BBB (stable outlook) by Standard and Poor's, Baa2 (stable outlook) by Moody's, and BBB (stable outlook) by Fitch.
Which of the following is not true? The coupon rate on these bonds would have been higher if Standard and Poor's, Moody's, and Fitch had assigned lower credit ratings.
Answer:
Identification of the Internal Control Weaknesses:
A. There is no segregation of duties and there is lack of access control. Jerry Miller as a security guard is not expected to have a master key to the cash box. With this he can pilfer the cash. If he prepares the report that shows the number of cars that parked on the lot, he is not supposed to also prepare the day's cash receipts. Otherwise, he can state any number of cars as parked that he likes, and which corresponds to the cash he might leave in the Cash box since he also has a master key.
B. There is no segregation of duties and there is lack of supervision, proper reconciliations, and assets audit. Sharon Fisher handles purchase transactions from the beginning to the close all alone with a third party. This exposes the company to procurement frauds and collusion with suppliers. She can purchase assets for the company at prices that would enrich her personally.
C. Forming an audit opinion on the basis of ratio analysis of last year's comparative financial statements exposes the company to audit risks. While ratio analysis is part of the basis for forming audit opinions, it is surely not the first audit procedure to obtain audit evidence to support his audit opinion on the financial statements. An auditor is expected to obtain sufficient audit evidence and perform audit substantive tests of financial statement assertions. He or she is also expected to review the internal control system to ensure that it is operating effectively after establishing its existence and reviewing changes in internal controls.
Explanation:
Internal Controls are controls established by management in order to help it achieve business goals. There are many internal controls, including Separation of Duties, Access Controls
, Authorization and Approvals, Asset Audits, Reconciliations, and Data Backups. The purposes of internal controls are to establish the reliability of financial reporting, ensure timely feedback on the achievement of operational or strategic goals, and achieve compliance with financial management laws, and accounting regulations.
Answer: Description, Date, and Amount.
Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Jessica’s Office Supply, Inc., had 300 calculators on hand on January 1, 2017, costing $16 each.
Purchases and sales of calculators during January were as follows:
January 12: 200 units for $25
J 14: 150 for $17
J 29: 100 for $18
J 30: 150 for $30
According to a physical count, 200 calculators were on hand on January 31, 2017.
FIFO:
Inventory= 150*30 + 50*18= $5,400
COGS= 300*16 + 200*25 + 150*17 + 50*18= $13,250
LIFO:
Inventory= 200*16= $3,200
COGS= 150*30 + 100*18 + 150*17 + 200*25 + 100*16= 15,450
Average cost method:
Average cost= (16 + 25 + 17 + 18 + 30)/5= 21.2
Inventory= 21.2*200= $4,240
COGS= 21.2* 700= $14,840
