Exam 7: Revenue and Collection Cycle

Inquiries of management usually do not provide very convincing evidence about the existence and rights assertions. Question also found in study guide

To conceal defalcations involving receivables,a dishonest bookkeeper might charge which of the following accounts?

Confirmations provide evidence of _________________________________ and,to a limited extent,________________________________ of accounts and notes receivable. Question also found in study guide

Tracing shipping documents to prenumbered sales invoices provides evidence that

The negative request form of accounts receivable confirmation is useful particularly when the

Negative confirmation of accounts receivable is less effective than positive confirmation of accounts receivable because

When an audit team does not receive a response on a positive accounts receivable confirmation,auditors should do all of the following except

The composition of Oak and Company's accounts receivable are as follows: Over $250,000 - 5 accounts Between $25,000 and $250,000 - 80 accounts Less than $25,000 - 200 accounts The best confirmation strategy for the auditor is:

In which of the following circumstances would the use of the negative form of accounts receivable confirmation most likely be justified?

Which of the following responses to an accounts receivable confirmation at December 31 would cause an audit team the most concern?

Which of the following audit procedures is the most effective in testing sales for understatement?

The control activity "credit sales approved by credit department" is directed toward which transaction assertion?

An auditor confirms a representative number of open accounts receivable as of December 31 and investigates respondents' exceptions and comments.By this procedure,the auditor would be most likely to learn of which of the following?

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?

When accounts receivable are confirmed at an interim date,auditors need not be concerned with

Which of the following questions included in an internal control questionnaire would evaluate the valuation objective of revenues?

Credit checks should be performed by the sales department before credit is approved. Question also found in study guide

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. Question also found in study guide

The file that contains sales transactions that were initiated in the system but are not yet completed is the

Custody of inventory is transferred to the shipping area upon authorization of