COMD 4153 : COMD 4153 Exam 1 PPT 6 Vowel 2
X number of units sold
X number of units available
for sale - units sold
ACCOUNTiNG 2001 Review for Exam II TEST DATE: 3/29/12
Results in a higher quality of earnings ratio LIFO
Results in higher phantom profits FIFO
Results in higher net income FIFO
Results in lower taxes LIFO
Results in lower net cash
Provided by operating activities FIFO
Cost of goods available for sale Cost of goods sold (AVCM)
Units available for sale
Cost of goods available for sale Ending inventory (AVCM)
Units available for sale
Beg. Inventory + Purchases – End. Inventory = Cost of goods sold
Gross profit – operating expense = Net income
Sales – cost of goods sold = Gross Profit
Sales Revenue – sales returns & allowances = Net Sales
ACTION
BANK INCREASE
BANK DECREASE
BOOK INCREASE
BOOK DECREASE
Outstanding Check
BANK LESS
Bank Service Charge
BOOK LESS
Deposit in transit
BANK ADD
Collection of NR by bank
BOOK ADD
Return of NSF check
BOOK LESS
Earned interest
BOOK ADD
Bank error
BANK ADD OR LESS
Book keeper error
BOOK ADD OR LESS
FRAUD
TRiANGLE
OPPORTUNiTY
RATIONALiZATiON
FiNANCiAL
PRESSURE
FiVE PRiMARY COMPONENTS OF INTERNAL
CONTROLS:
1. A control environment
2. Risk assessment
3. Control activities
4. Information & communication
5. Monitoring
