Yоur CPA firm hаs been аsked tо perfоrm the first finаncial statement audit of Summit Precision Manufacturing, Inc., a privately held manufacturer of specialized machine components. During the planning process, you learn the following: Summit has experienced rapid growth during the past two years. The company recently obtained a large bank loan. The loan agreement requires Summit to maintain certain financial ratios. Management bonuses are based partly on reported operating income. Summit implemented a new accounting system in October. Reported revenue increased 28% this year, although the number of units shipped increased only 9%. Accounts receivable increased 46%. Inventory increased 38%, including several product lines that have experienced declining sales. The company president tells the audit partner: “Our accounting department is excellent. These people have been with me for years. I don't expect your team will need to spend much time testing transactions.” Using the same two areas you selected: For each area: Describe one specific audit procedure you would perform. Explain what evidence you expect the procedure to provide. Explain why that evidence would be relevant and reasonably reliable.
Yоu hаve decided tо help а lоcаl dairy farm produce cream and skim milk. The separating device has one inlet channel containing whole milk with a diameter of 7 cm (ρ=1.026 gm/cm3). The device has two outlet channels (outlet 1 has a diameter of 3 cm and delivers heavy whipping cream (ρ=1.008 gm/cm3) at 1.AB mL/min, and outlet 2 delivers skim milk (ρ=1.034 gm/cm3) and has a diameter of 3 cm and volumetric flow rate four times that of outlet 1). Determine the mass flow rate (g/s) and velocity of media (cm/s) in each of the three channels. What is the total volume of heavy whipping cream produced in an 8-hour production shift? *helpful tip: you don’t need to worry about weight fractions for this problem*