You are engaged to perform an audit of the Giordani Corporation for the year end

Question

You are engaged to perform an audit of the Giordani Corporation for the year ended December 31, 2013. You have decided to perform the following cutoff test for payables and accruals. Select all items greater than $25,000 for two business days before and after year-end from the purchases journal and ensure that all transactions are recorded in the proper period.

During your firm's observation of Giordani's physical inventory you obtained the following cutoff information: the last receiving report number in 2013 was 49,745. Your audit work identified the following items for further investigation:

Required:

For each of the six items provided in the table above, consider whether there is evidence of proper cutoff of payables and accruals (i.e., the transaction is recorded in the proper period). If the item is not properly recorded, prepare the necessary adjusting entries at December 31, 2013.

You are engaged to perform an audit of the Giordani Corporation for the year ended December 31, 2013. You have decided to perform the following cutoff test for payables and accruals. Select all items greater than $25,000 for two business days before and after year-end from the purchases journal and ensure that all transactions are recorded in the proper period.

During your firm's observation of Giordani's physical inventory you obtained the following cutoff information: the last receiving report number in 2013 was 49,745. Your audit work identified the following items for further investigation:

Explanation / Answer

You are engaged to perform an audit of the Giordani Corporation for the year end

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