You are engaged in an audit of the financial statement of Young Corporation for the...
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You are engaged in an audit of the financial statement of Young Corporation for the year ending December 31, 20X2. The financial statements and records of Young Corporation have not been audited by another auditor in prior years. The stockholders' equity section of Young Corporation's balance sheet at December 31, 20X2, is as follows. YOUNG CORPORATION STOCKHOLDERS' EQUITY SECTION OF BALANCE SHEET AT DECEMBER 31, 20X2 Stockholders' Equity: Common Stock, 10,000 shares of S10 par value authorized, 5,000 shares issued and outstanding Contributed Capital in Excess of Par Value Retained Earnings 50,000 32,580 47,320 129,900 Total Stockholders Equity The company was founded in 20X0 with ten stockholders and serves as its own registrar and transfer agent. There are no common stock subscriptions in effect. REQUIRED: () Prepare an audit program, with the appropriate audit procedures, to audit the three accounts that make up the Young Corporation's stockholders' equity section. Why do auditors audit retained earnings? (2)
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