FINANCIAL ACCOUNTING
6th Edition
ISBN: 9781618533111
Author: DYCKMAN
Publisher: Cambridge Business Publishers
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Chapter 1, Problem 50CP
a.
To determine
Discuss the reason behind a CPA being independent when providing audit services.
b.
To determine
Identify the activities or relationships of Person J which impair his independence.
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Upon graduation from high school, William Nitter accepted a job as a plumber's assistant for a large local plumbing company. After
three years of hard work, William received a plumbing licence and decided to start his own business. He had saved $31,000, which he
invested in the business. His lawyer had advised him to start as a corporation. First, he transferred the $31.000 from his savings
account to a business bank account for Willam's Plumbing Services Inc. and was issued shares. He then purchased a used panel truck
for $21,500 cash and second-hand tools for $3,700, rented space in a small building, inserted an advertisement in the local paper, and
opened his business on July 1 of the current year. Immediately. William was very busy, after one month, he employed an assistant
D
Although William knew practically nothing about the financial side of the business, he realized that a number of reports were required
and that expenses and collections from clients had to be controlled…
John Mason is the owner and president of Digital Imagery and More Ltd., a company in the
multimedia industry. The revenue of the business is about $ 20 million a year. In the past few
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Swimming pool built at his home: $40 000
Renovations to his cottage: $7500
• Landscaping around his home: $4000
Although each of these expenditures was of a personal nature, Mason requested that invoices for
the charges be sent to his company, Digital Imagery and More Ltd. All of the expenditures were
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a. As his accountant, what will you advise John to do? In your answer, be sure to include
accounting principles and CPA Code of Conduct reference.
Upon graduation from high school, William Nitter accepted a job as a plumber's assistant for a large local plumbing company. After
three years of hard work, William received a plumbing licence and decided to start his own business. He had saved $31,000, which he
Invested in the business. His lawyer had advised him to start as a corporation. First, he transferred the $31,000 from his savings
account to a business bank account for William's Plumbing Services Inc. and was issued shares. He then purchased a used panel truck
for $21,500 cash and second hand tools for $3,700, rented space in a small building, Inserted an advertisement in the local paper, and
opened his business on July 1 of the current year. Immediately. William was very busy, after one month, he employed an assistant
A
Although William knew practically nothing about the financial side of the business, he realized that a number of reports were required
and that expenses and collections from clients had to be controlled…
Chapter 1 Solutions
FINANCIAL ACCOUNTING
Ch. 1 - Prob. 1MCCh. 1 - Prob. 2MCCh. 1 - Prob. 3MCCh. 1 - Prob. 4MCCh. 1 - Prob. 5MCCh. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3QCh. 1 - Prob. 4QCh. 1 - Prob. 5Q
Ch. 1 - Prob. 6QCh. 1 - Prob. 7QCh. 1 - Prob. 8QCh. 1 - Prob. 9QCh. 1 - Prob. 10QCh. 1 - Prob. 11QCh. 1 - Prob. 12QCh. 1 - Prob. 13QCh. 1 - Prob. 14QCh. 1 - Prob. 15QCh. 1 - Prob. 16QCh. 1 - Prob. 17QCh. 1 - Prob. 18QCh. 1 - Prob. 19MECh. 1 - Prob. 20MECh. 1 - Prob. 21MECh. 1 - Prob. 24MECh. 1 - Prob. 25MECh. 1 - Prob. 26MECh. 1 - Prob. 27ECh. 1 - Prob. 28ECh. 1 - Prob. 29ECh. 1 - Prob. 30ECh. 1 - Prob. 31ECh. 1 - Prob. 32ECh. 1 - Prob. 33ECh. 1 - Prob. 34ECh. 1 - Prob. 35ECh. 1 - Prob. 36PCh. 1 - Prob. 37PCh. 1 - Prob. 38PCh. 1 - Prob. 39PCh. 1 - Prob. 40PCh. 1 - Prob. 41PCh. 1 - Prob. 42PCh. 1 - Prob. 43PCh. 1 - Prob. 44PCh. 1 - Prob. 45PCh. 1 - Prob. 46CPCh. 1 - Prob. 47CPCh. 1 - Prob. 48CPCh. 1 - Prob. 49CPCh. 1 - Prob. 50CP
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