DeVry University Audit and Accounting Questions

Please answer the questions listed below and submit in a word document.

Chapter 5: Exercise 54, page 5-60

You receive a tip on the company’s hot line that there has been some fraud in the collections area. What five audit steps would you suggest using in order to find the fraud?

Chapter 6: Exercise 39, page 6-31

Explain proactive auditing. Compare with reactive auditing. Give specific techniques.

Chapter 7 Exercise 38, page 7-42

The Dirty Accountant? Logan Johnson is a recent graduate of MidUniversity’s accounting program. She has begun her work as the accountant for Platinum Automotive run by Joe and Tom Younger. Platinum has a series of car lots where they sell top-end “previous driven” cars in Baltimore, Maryland. On February 6, 2011, Joe Younger sold a 2010 BMW X3, 3.01 SUV for $38,000. Logan entered the following entry into the accounting database for the sale: Feb. 6, 2011 Cash 9,800 Note Receivable 28,200 BMW X3 38,000 Logan thought nothing of the sale. On February 10, Joe Younger dropped off documentation that showed $9,900 of the loan had been paid off. Logan booked the proper entries. On February 15 and again on February 20, documentation showed that the loan was being repaid and paid off with payments of $9,500 and $8,800, respectively. Shortly afterward, Logan received an envelope with $250 in cash on her desk. On the front of the envelope, the word “bonus” was written. Logan is happy that her work is being favorably recognized by the owners. Do you have any advice for Logan?