8. The auditor reviews the detail to the accounts receivable Account which has a general ledger balance of $110,000. Detail Support Customer B C D Balance $80,000 40,000 (30,000) 20,000 Total $ 110,000 3D%3D%3D%3D%3Dmm a. Type of evidence Scanning; Accounts receivable to be reported on balance Sheet $110,000. b. Type of evidence Scanning: Accounts receivable to be reported on balance Sheet $140,000. c. Type of evidence Analytical Reviews Accounts receivable to be reported on balance sheet $110,000. d. Type of evidence Analytical Review; Accounts receivable to be reported on balance Sheet $140,000. Answer 9. Auditors sometimes use ratios as audit evidence. For example, an unexplained DECREASE in the ratio of gross profit to sales may suggest which of the following possibilities? a. Fictitious purchases b. Fictitious sales. c. Selling expense recorded as general expense. d. Unrecorded Purchases. Answer 10. Significant deficiencies are matters that come to an auditor's attention that should be communicated to an entity's audit committee because they represent a. disclosures of information that significantly contradict the auditor's going concern assumption. b. material fraud or noncompliance with laws and regulations perpetrated by high-level management. c. significant deficiencies in the design or operation of internal controls. d. manipulation or falsification of accounting records or documents from which financial statements are prepared. Answer From Surgent's CPA Review Try Area 1