Laramie Wire Manufacturing

Case 8.1 Laramie Wire Manufacturing 1. Cost of gross revenue The cost of staring(a) sales summation 3% from 2007 to 2008 comp atomic number 18d the sales increase 4% in the same breaker point. That ratio is legitimate amid periods and I do not believe there is anything that should balk out to the auditor. eld Sales in Receivables Days Sales in Receivables increase 16% from 2007 to 2008. There might be customers who are not paying due to various divergent reasons. The auditors wish to drift that the receivables exist, are properly valuated, are within the cutoff period for the audit and the amount is correct for uncollectable accounts. Inventories The plastics stock-take increased 23% although Copper celestial pole inventory increased 59%. destroyed Goods Inventory increased 41% from 2007 to 2008. The ships bell of plastics decreased from $0.19 to $0.12.The price of cop rod stayed the same at $.48 a pound. The increase in price of plastics can formulat e why inventories of plastics and copper changed. The expected comfort of Copper Rod = 5,900,000*.48 = 2,832,000 The expected value of plastics = 1,100,000 * .12 = 132,000 The expected value of plastics is not consistent with carrying costs at lower of cost or marketplace pricing. This area needs to be checked by the auditor. The even up footage allotment too needs further examination.

25% (125,000sq.ft) is allocated to warehousing. currently the copper rod inventory alone would demand 141,000 sq. ft. which is much than is allocated for the entire inventory. The auditors should earn sure that al l existing inventories soak up been recorde! d completely, go to the warehouse and ensure all the inventories are recorded in the inventory ledger. Accounts Payable The accounts payable increased 6% temporary hookup inventories increased much higher. This is not consistent and the balances of inventory accounts and payables need to be verified. Inventory should be counted to verify that it is correct and exists. 2. The prey of analytical procedures is to...If you want to lay a full essay, dictate it on our website: OrderCustomPaper.com

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