Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. The most appropriate procedure an auditor can use to ensure integrity of the sales and collection cycle is to: confirm accounts receivablesbalances ensure the

1.The most appropriate procedure an auditor can use to ensure integrity of the sales and collection cycle is to:

confirm accounts receivablesbalances

ensure the bank reconciliations are prepared by one who also handles sales returns so missing items can be accounted for timely

observe the sales person manually account for the integrity of the numerical sequence of sales orders

recalculate the sales list prise of all products in the computer files that are accessed by sales personnel

2.When auditing the inventory cycle the auditor should do all of the following EXCEPT:

Adjust the balance in the inventory account to reflect the perpetual inventory counts

Assess the value of obsolete or damaged inventory

Calculation inventory turnover rates

Review the procedures for the count of physical inventory

3.Tests of controls for the acquisition and payment cycle are usually done by:

Inquires and documentation of management 's representations

Recalculating sales tax amounts

Sending out confirmations for amounts under $10,000

Testing the classification of accounts payable items

4.Cash is the most desirable asset for people to misappropriate, when determining risk as part of the audit process, cash would have a higher:

control risk

detection risk

inherent risk

misstatement risk

5.A __________ is a communication addressed to a customer requesting him or her to confirm whether the balance as stated on the document is correct or incorrect

negative confirmation

positive confirmation

representation letter

representative confirmation

6.When an auditor looks at a report with over 500 purchases and decides to review all of the purchase over $1,000,000 this is an example of what type of sampling?

Judgmental sampling

Random sampling

Statistical sampling

This is not sampling

7.The overall objective in the audit of the acquisition and payment cycle is to:

ensure the accuracy of the accounts payable and purchases accounts

ensure the accuracy of the cash disbursement journal

evaluate whether the affected accounts are fairly stated in accordance with GAAP

to evaluate the accuracy of the management'sstatements and what was written in the engagement letter

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To Management Accounting A User Perspective

Authors: Michael L Werner, Kumen H Jones

2nd Edition

0130327506, 9780130327505

Students also viewed these Accounting questions