Horizontal Analytical Procedures Baumholder & Barbar, CPAs, audited the consolidated financial statements of Aladdin Company...

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Accounting

Horizontal Analytical Procedures Baumholder & Barbar, CPAs, audited the consolidated financial statements of Aladdin Company (a nonissuer) for the year ended December 31, Year 1, and expressed a qualified opinion. Baumholder & Barbar also audited Aladdin's financial statements for the year ended December 31, Year 2, and is worried they may have to express a modified opinion as Aladdin appears to be having a major problem keeping its bills paid and its inventory sold. The following consolidated financial statements were presented on a comparative basis with those of the prior year. Aladdin, Co. Comparative Balance Sheets December 31, Year 2 and Year 1 Year 2 Year 1 Assets Current assets Cash and cash equivalents $100,000 $750,000 Receivables 200,000400,000 Inventory 100,000100,000 Prepaids 25,000100,000 Total current assets 425,0001,350,000 Property, plant, and equipment - net 200,000200,000 Other assets 100,000350

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