1. insurance expense 917.

00
prepaid insurance (22k * .5/12) 917.00

2. prepaid dues and subscriptions 5,000.00

dues and subscriptions expense 5,000.00

3. accounts payable 111,500.00

inventory 111,500.00

4. accounts payable 84,000.00

inventory 84,000.00

5. legal and professional fees expense 46,000.00

accounts payable 46,000.00

6. medical expenses 25,000.00

accounts payable 25,000.00

7. inventory 55,000.00
accounts payable 55,000.00

8. machinery and equipment 254,000.00

accounts payable 254,000.00
 Accounts Title Audit procedures to be performed

·         Reconciling general

Accounts payable ledger and subsidiary
ledger

Interest payable ·         Test the computation of interest

payable

Notes payable ·         Review compliance with the terms of

debt agreements

Evaluate the reasonableness of accounting

Warranties
estimates made by management.
 Detailed steps for the procedures to be performed
Obtain a copy of the entity's subsidiary ledger and general ledger
reconciliation. Following that, the auditor should test the clerical accuracy
schedule and then review the entity's reconciliation between the sub-ledger
and control account. Also, look into reconciling items, especially any unusual
or out-of-the-ordinary journal entries.

The auditor should obtain the interest rate and recalculate the amount reported
as interest payable based on the number of months the obligation is
outstanding during the current year as part of this procedure.

To determine whether a default or violation of any debt covenant has

occurred, the auditor should examine the entity's compliance with terms,
restrictive covenants, or other provisions of debt agreements. If any debt
covenant has been violated or defaulted on, the auditor should make sure that
it is properly disclosed in the notes and that the item is appropriately presented
as a current liability in the statement of financial position.

a. The auditor should normally take into account the entity's historical
experience in making past estimates, as well as the auditor's own industry
experience. The auditor should obtain an understanding of how
management developed the estimate by reviewing and testing the process
used by management to develop the estimate and develop an independent
expectation of the estimate to corroborate the reasonableness of
management's estimate.
 Assertions to be addressed

Completeness; Valuation

Valuation; Accuracy

Presentation; Disclosure

Valuation; Allocation
 What could go wrongs or risk if the procedures is not performed

It will not determine whether the liability figure in the statement of financial position corresponds to the
detailed records' individual items.

This might affect the either there is overstated or understated of the account of interest payable.

It might result overstatement or understatement of the notes payable.

The disclosure and reasonable of the accounting estimate will not become appropriate.