a. Revenue recognition has specific criteria. Of the following, which is not one of those criteria:

• Price is either fixed or able to be determined
• evidence of the contract arrangement both exist and are persuasive
• services have been rendered or delivery has occurred
• collectibility of the transaction amount is certain

b. When an auditor sends confirmation to debtors to confirm individual accounts receivable balances, the auditor is obtaining evidence concerning:

• Adequate internal control over the confirmed balances
• ownership of the confirmed balances
• collectible status of the confirmed balances
• existence of the confirmed balances

c. Which of the following procedures would help an auditor discover that a large credit sales had inadvertently been recorded twice by the client?

• observing the client's year-end physical inventory count
• confirming accounts receivable balances with account holders
• recalculating and footing the sales journal
• tracing total sales amounts in the sales journal to the general ledger

d. Auditor will trace documentation from the start point to the end point when performing an audit. If the sales invoice is being traced to the shipping document, what evidence has been established?

• shipment to customer were properly recorded as accounts receivables
• billed sales were shipped
• shipments to customers have been billed
• debits that have been ;osted to the accounts receivables subsidiary ledgers are for sales shipped

e. Erroneously recognizing a loan received as revenue instead of correctly recognizing it as a liability has a positive effect on the financial statements prepared for the period for all of the following except:

• revenues will be overstated
• liabilities will be understated
• expenses will be understated
• net income will be overstated