1. an auditor noted that client sales had increased 10% for the year. At the same time, cost of goods sold as a percentage of sales had decreased from 45% to 40% and year-end accounts receivable had increased by 8%. The auditor is most likely concerned about: a. unrecorded cost b. improper credit approvals c. improper sales cut-off d. fictitious sales

2. an auditor noted that client sales had increased 10% for the year. At the same time, cost of goods sold as a percentage of sales had decreased from 45% to 40% and year-end accounts receivable had increased by 8%. The auditor interviewed the sales manager who stated that the increase in sales without a corresponding increase in cost of goods sold was due to a price increase in acted by the company during the year. How would the auditor best test the sales manager's representation? a. preformed additional inquiries with sales personnel b. obtain copies of all price list in used during the year and vouch the prices to sales invoices c. send confirmations asking customers about unit prices paid for product d. vouch vendor invoices to payments made after year-end