What is the relationship between volume and variable cost per unit?
If the variable cost per unit remains fixed, then any increase or decrease in unit volume will result in an increase or decrease in total variable costs for a business. For example, if variable cost per unit was steady at $5, then if unit volume were to increase from 100 to 200 units, then total […]More
How can variable sampling risk impact the efficiency or effectiveness of an audit?
Audit risk is comprised of inherent risk, control risk, and detection risk. The level of substantive testing that the audit performs is based on detection risk, which is set after the audit team assesses inherent risk and control risk. Variable Sampling – Substantive Testing When the audit team is performing substantive testing, they will use […]More
What happens if control risk is set too high or too low?
Audit risk is comprised of inherent risk, control risk, and detection risk. Depending on how the audit team assesses control risk, they would set detection risk, which determines the level of substantive testing that should be performed. To assess control risk, the audit team would use attribute sampling to determine if the controls were operating […]More
What is business intelligence?
In general, business intelligence is the strategy and technology used by a company to analyze their data. There are a number of difference functions that fall under the business intelligence umbrella. These include analytics, data mining, processing mining, use of dashboards, etc. The biggest problem most companies face is that they have a ton, and […]More
How can visual learning help me prepare for the CPA exam?
Recent studies have estimated that over 65% of students prefer visual learning. So if that is the case, why hasn’t visual learning been used for CPA exam prep before Universal CPA Review came along? That is the question we asked, and that is why Universal CPA Review was created. Traditional Method vs Visual Learning Method […]More
Are stimulus checks considered taxable income?
No, according to the IRS, stimulus checks are non-taxable income, which means that you won’t have to include the amount in your calculation of taxable income. Technically, the stimulus check is considered a refundable tax credit. The good news for taxpayers is that if you didn’t receive the full stimulus check due to your 2018/2019 […]More
Is a change from non-GAAP to GAAP considered an accounting error?
If a company switches from non-GAAP to GAAP, that is considered an accounting error and not a chance in accounting policy. Since a company’s financial statements must be prepared in accordance with GAAP, any item that is non-GAAP would be considered an error. An error is a type of accounting change that requires restatement. Restatement […]More
How will blockchain impact accounting?
Take a deep breath. If you are reading this, then you’ll be more knowledgeable than a majority of accounting professionals. As an accounting professional, you should welcome blockchain with open arms as it has the potential to revolutionize the accounting and finance industry. Why is blockchain so revolutionary? Right now, accounting records are stored in […]More