Provide the applicable assertion that applies to the statement with the applicable assertion. An assertion can used more than once or not at all. Each statement only has 1 assertion that applies.(10 marks)

Assertion List

Accuracy

Classification

Completeness

Cut-off

Existence

Occurrence

Rights and obligations

Valuation

• The company made a large amount of sales right before year-end.

Answer 1

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The company's cash balance has increased substantially compared to prior year.

Answer 2

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The auditor is concerned that there might be damaged equipment.

Answer 3

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The company's gross profit increased by 25% during the year, but administrative expenses also increased by 25% during the year. Gross profit is a key metric for management's bonus.

Answer 4

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The company's payroll has increased by 25% compared to the prior year.

Answer 5

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• During the inventory count, the auditor found a box of televisions in the warehouse that did not appear on the inventory listing.

Answer 6

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The company has not recorded any balance for allowance for doubtful accounts

Answer 7

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• The bank uses the company's accounts receivable as collateral for their operating loan.

Answer 8

Choose...

Accuracy

Rights and obligations

Completeness

Valuation

Occurrence

Classification

Cut-off

Existence

• Sales increased substantially during the year compared to the prior year.