Question 1

Unrecorded liabilities can be prevented if there is an appropriate segregation of duties in accounts payable.

Accepted Answer

A) True 
 B)False

Question 2

For which of the following accounts would the matching concept be the most appropriate?

Accepted Answer

A) Cost of Goods Sold. 
B) Research and Development. 
C) Depreciation Expense. 
D) Sales. 
A) Cost of Goods Sold. 
B) Research and Development. 
C) Depreciation Expense. 
D) Sales.

Question 3

An auditor wishes to perform tests of controls on a client's purchasing procedures.If the control activities leave no audit trail of documentary evidence,the auditor most likely will test the procedures by

Accepted Answer

A) Confirmation and observation. 
B) Observation and inquiry. 
C) Analytical procedures and confirmation. 
D) Inquiry and analytical procedures. 
A) Confirmation and observation. 
B) Observation and inquiry. 
C) Analytical procedures and confirmation. 
D) Inquiry and analytical procedures.

Question 4

Failure to record a liability generally results in

Accepted Answer

A) An understatement of profit. 
B) An understatement of current ratio. 
C) An overstatement of profit. 
D) An overstatement of assets. 
A) An understatement of profit. 
B) An understatement of current ratio. 
C) An overstatement of profit. 
D) An overstatement of assets.

Question 5

When the _________________________________,______________________________ and _________________________ are in hand,the accountants can record the accounts payable.
Reference: Question also found in study guide

Accepted Answer

purchase order; vend

Question 6

The _____________________________________ inspects the goods received for _____________________________ and _____________________________ and then puts them in the hands of other responsible persons.
Reference: Question also found in study guide

Accepted Answer

receiving

Question 7

The inherent risk that accounts payable may be omitted or otherwise understated typically is

Accepted Answer

A) Low. 
B) High. 
C) Moderate. 
D) Indeterminate. 
A) Low. 
B) High. 
C) Moderate. 
D) Indeterminate.

Question 8

In determining the effectiveness of an entity's policies and procedures relating to the occurrence assertion for payroll transactions,auditors most likely would inquire about and

Accepted Answer

A) Observe the separation of duties concerning personnel responsibilities and payroll disbursement. 
B) Inspect evidence of accounting for prenumbered payroll checks. 
C) Recompute the payroll deductions for employee fringe benefits. 
D) Verify the preparation of the monthly payroll account bank reconciliation. 
A) Observe the separation of duties concerning personnel responsibilities and payroll disbursement. 
B) Inspect evidence of accounting for prenumbered payroll checks. 
C) Recompute the payroll deductions for employee fringe benefits. 
D) Verify the preparation of the monthly payroll account bank reconciliation.

Question 9

The test of controls for purchases,cash disbursements,and accounts payable include the following audit procedures.Next to each of the procedures,indicate the related transaction assertion.

Accepted Answer

1.completeness; 2.oc

Question 10

"All purchase orders are supported by requisitions from proper persons" is a specific example of which management assertion?

Accepted Answer

A) Occurrence. 
B) Completeness. 
C) Cutoff. 
D) Classification. 
A) Occurrence. 
B) Completeness. 
C) Cutoff. 
D) Classification.

Question 11

An auditor most likely would assess control risk at the maximum if the payroll department supervisor is responsible for

Accepted Answer

A) Examining authorization forms for new employees. 
B) Comparing payroll registers with original batch transmittal data. 
C) Distribute payroll checks to all employees. 
D) Hiring all subordinate payroll department employees. 
A) Examining authorization forms for new employees. 
B) Comparing payroll registers with original batch transmittal data. 
C) Distribute payroll checks to all employees. 
D) Hiring all subordinate payroll department employees.

Unrecorded liabilities can be prevented if there is an appropriate segregation of duties in accounts payable.

For which of the following accounts would the matching concept be the most appropriate?

An auditor wishes to perform tests of controls on a client's purchasing procedures.If the control activities leave no audit trail of documentary evidence,the auditor most likely will test the procedures by

Failure to record a liability generally results in

When the _______, and _ are in hand,the accountants can record the accounts payable. Reference: Question also found in study guide

The _______________________ inspects the goods received for _ and _______________ and then puts them in the hands of other responsible persons. Reference: Question also found in study guide

The inherent risk that accounts payable may be omitted or otherwise understated typically is

In determining the effectiveness of an entity's policies and procedures relating to the occurrence assertion for payroll transactions,auditors most likely would inquire about and

The test of controls for purchases,cash disbursements,and accounts payable include the following audit procedures.Next to each of the procedures,indicate the related transaction assertion.

"All purchase orders are supported by requisitions from proper persons" is a specific example of which management assertion?

An auditor most likely would assess control risk at the maximum if the payroll department supervisor is responsible for

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

Revenue and Collection Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Audits, Governmental Audits, and Fraud Examinations

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing and Information Technology

Filters

Exam 8: Acquisition and Expenditure Cycle

Unrecorded liabilities can be prevented if there is an appropriate segregation of duties in accounts payable.

For which of the following accounts would the matching concept be the most appropriate?

An auditor wishes to perform tests of controls on a client's purchasing procedures.If the control activities leave no audit trail of documentary evidence,the auditor most likely will test the procedures by

Failure to record a liability generally results in

When the _________________________________,______________________________ and _________________________ are in hand,the accountants can record the accounts payable. Reference: Question also found in study guide

The _____________________________________ inspects the goods received for _____________________________ and _____________________________ and then puts them in the hands of other responsible persons. Reference: Question also found in study guide

The inherent risk that accounts payable may be omitted or otherwise understated typically is

In determining the effectiveness of an entity's policies and procedures relating to the occurrence assertion for payroll transactions,auditors most likely would inquire about and

The test of controls for purchases,cash disbursements,and accounts payable include the following audit procedures.Next to each of the procedures,indicate the related transaction assertion.

"All purchase orders are supported by requisitions from proper persons" is a specific example of which management assertion?

An auditor most likely would assess control risk at the maximum if the payroll department supervisor is responsible for

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

Revenue and Collection Cycle

Production Cycle

Finance and Investment Cycle

Completing the Audit

Reports on Audited Financial Statements

Other Public Accounting Services

Professional Ethics

Legal Liability

Internal Audits, Governmental Audits, and Fraud Examinations

Overview of Sampling

Attributes Sampling

Variables Sampling

Auditing and Information Technology

Filters

When the _______, and _ are in hand,the accountants can record the accounts payable. Reference: Question also found in study guide

The _______________________ inspects the goods received for _ and _______________ and then puts them in the hands of other responsible persons. Reference: Question also found in study guide