Question 1

When an account receivable is considered uncollectible,the person who generally authorizes the write-off is the client's

Accepted Answer

A)  Credit manager. 
B)  Treasurer. 
C)  Accountant. 
D)  Internal auditor. 
A)  Credit manager. 
B)  Treasurer. 
C)  Accountant. 
D)  Internal auditor.

Question 2

A confirmation procedure scheduled on the year-end date with a large sample of customer account balances is necessary if tests of controls reveal control weaknesses.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following accounts is not normally part of the revenue and collection cycle?

Accepted Answer

A)  Sales. 
B)  Accounts Receivable. 
C)  Cash. 
D)  Purchases Returns and Allowances. 
A)  Sales. 
B)  Accounts Receivable. 
C)  Cash. 
D)  Purchases Returns and Allowances.

Question 4

Auditors should not place total reliance on controls to the exclusion of other substantive testing procedures.

Accepted Answer

A) True 
 B)False

Question 5

The SEC requires all of the following for revenue to be recognized except

Accepted Answer

A)  Cash is collected. 
B)  Persuasive evidence of an arrangement exists. 
C)  Delivery has occurred or services have been rendered. 
D)  The seller's price to the buyer is fixed or determinable. 
A)  Cash is collected. 
B)  Persuasive evidence of an arrangement exists. 
C)  Delivery has occurred or services have been rendered. 
D)  The seller's price to the buyer is fixed or determinable.

Question 6

Tracing shipping documents to prenumbered sales invoices provides evidence that

Accepted Answer

A)  No duplicate shipments or billings occurred. 
B)  Shipments to customers were properly invoiced. 
C)  All goods ordered by customers were accounted for. 
D)  All prenumbered sales invoices were accounted for. 
A)  No duplicate shipments or billings occurred. 
B)  Shipments to customers were properly invoiced. 
C)  All goods ordered by customers were accounted for. 
D)  All prenumbered sales invoices were accounted for.

Question 7

In the revenue and collection cycle,the auditor checks the numerical sequence of shipping documents.This procedure is related to which of the following assertions?

Accepted Answer

A)  Existence. 
B)  Completeness. 
C)  Rights and obligations. 
D)  Valuation or allocation. 
A)  Existence. 
B)  Completeness. 
C)  Rights and obligations. 
D)  Valuation or allocation.

Question 8

Sales are normally recorded on the date of the

Accepted Answer

A)  Customer purchase order. 
B)  Bill of lading. 
C)  Sales invoice. 
D)  Payment check. 
A)  Customer purchase order. 
B)  Bill of lading. 
C)  Sales invoice. 
D)  Payment check.

Question 9

Which of the following might be detected by auditors' cutoff review and examination of sales journal entries for several days prior to the balance sheet date?

Accepted Answer

A)  Lapping year-end accounts receivable. 
B)  Inflating sales for the year. 
C)  Kiting bank balances. 
D)  Misappropriating merchandise. 
A)  Lapping year-end accounts receivable. 
B)  Inflating sales for the year. 
C)  Kiting bank balances. 
D)  Misappropriating merchandise.

When an account receivable is considered uncollectible,the person who generally authorizes the write-off is the client's

A confirmation procedure scheduled on the year-end date with a large sample of customer account balances is necessary if tests of controls reveal control weaknesses.

Which of the following accounts is not normally part of the revenue and collection cycle?

Auditors should not place total reliance on controls to the exclusion of other substantive testing procedures.

The SEC requires all of the following for revenue to be recognized except

Tracing shipping documents to prenumbered sales invoices provides evidence that

In the revenue and collection cycle,the auditor checks the numerical sequence of shipping documents.This procedure is related to which of the following assertions?

Sales are normally recorded on the date of the

Which of the following might be detected by auditors' cutoff review and examination of sales journal entries for several days prior to the balance sheet date?

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Employee Fraud and the Audit of Cash

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing in a Computerized Environment

Filters

Exam 7: Revenue and Collection Cycle

When an account receivable is considered uncollectible,the person who generally authorizes the write-off is the client's

A confirmation procedure scheduled on the year-end date with a large sample of customer account balances is necessary if tests of controls reveal control weaknesses.

Which of the following accounts is not normally part of the revenue and collection cycle?

Auditors should not place total reliance on controls to the exclusion of other substantive testing procedures.

The SEC requires all of the following for revenue to be recognized except

Tracing shipping documents to prenumbered sales invoices provides evidence that

In the revenue and collection cycle,the auditor checks the numerical sequence of shipping documents.This procedure is related to which of the following assertions?

Sales are normally recorded on the date of the

Which of the following might be detected by auditors' cutoff review and examination of sales journal entries for several days prior to the balance sheet date?

Auditing and Assurance Services

Professional Standards

Engagement Planning

Management Fraud and Audit Risk

Risk Assessment: Internal Control Evaluation

Employee Fraud and the Audit of Cash

Acquisition and Expenditure Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Governmental and Fraud Audits

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing in a Computerized Environment

Filters