Question
8.6Sales invoices and journalLO3 Seb Lee and Boris Shonkoff are discussing the audit program for the revenue account. Seb and Boris disagree about whether they
8.6Sales invoices and journalLO3
Seb Lee and Boris Shonkoff are discussing the audit program for the revenue account. Seb and Boris disagree about whether they should use procedure A or B below to test the occurrence assertion for the revenue account:
- A.Select a sample of sales from the sales journal and agree the details in the journal to the sales invoices, delivery slips, and customer orders.
- B.Select a sample of sales invoices, delivery slips, and customer orders and agree the details to the details recorded in the sales journal.
Required
Which test provides evidence about the occurrence assertion? Why? Which assertion does the other test provide evidence about?
Source:Adapted from the Institute of Chartered Accountants Australia's CA Program's Audit and Assurance Exam, July 2010. Provided courtesy of Chartered Accountants Australia and New Zealand.
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Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson
6th edition
978-0077328894, 71313974, 9780077395810, 77328892, 9780071313971, 77395816, 978-0077400163
