# acc_460_week_1_gasb__and_fasb_acco...

Jun 2nd, 2015
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acc_460_week_1_gasb__and_fasb_acco...

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8-16 (Analytical procedures) In audit planning the audit of Circuits Technology, Inc. (CTI). CTI resells, installs, and provides computer networking products (client software, gateway hardware and software, and twinax hardware) to other businesses. Figure 8-14 provides some summary information from CTIs financial statements.Requireda. Calculate purchases, gross margin, inventory turn days, accounts receivable turn days, and accounts payable turn days for the years ended 20x2, 20x3, 20x4, 20x5.Purchases2002 = 2691 + 1327 - 1025 = 29932003 = 2399 + 1099 - 1327 = 21712004 = 2095 + 1003 - 1099 = 19992005 = 1859 + 1027 - 1003 = 1883Gross margin% 2002 = 5638 2691 = 2947/5638= 52.2%2003 = 4623 2399 = 2224/4623 = 48.1%2004 = 4022 2095 = 1927/4022 = 47.9%2005 = 3905 1859 = 2046/3905 = 52.3 %Inventory Turn-over days2002 = 1176/2691*365 = 159.52003 = 1213/2399*365 = 184.52004 = 1051/2095*365 = 183.12005 = 1015/1859*365 = 199.2Accounts Receivable Turn-over Days 2002 =1086/5638*365= 70.32003 =1228/4623*365 = 96.92004 =1041.5/4022*365= 94.52005 =892/188*365= 83.3Accounts Payable Turn-over Days 2002 = 2993/272 = 11.00367647 365/11.00367647= 33.12003 =2171/302.5= 7.176859504 365/7.176859504 = 50.82004 = 1999/213 = 9.384976526 365/9.384976526 = 38.92005 = 1883/188 = 10.01595745 365/10.01595745 = 36.4b. Describe the trends identified by performing analytical procedures in the gross operating cycle, the ne

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