A)An Auditor Is Concerned That Accounts Receivable May Be Understated

Question

Examlex · Accepted Answer

The Answer is A)The understatement of sales and accounts receivable is best uncovered by substantive tests of transactions for shipments made but not recorded by tracing from a sample of shipping documents (bills of lading)to the sales journal to verify that each shipment has been recorded.
B)The classification objective is tested by reviewing the aged trial balance for material amounts receivable from affiliates,officers,directors,or other related parties.If notes receivable or accounts that should not be classified as a current asset are included with the regular accounts,these should also be segregated.Finally,if credit balances in accounts receivable are significant,it is appropriate to reclassify them as accounts payable.

A)An Auditor Is Concerned That Accounts Receivable May Be Understated

Essay

Correct Answer:
Verified

A)An Auditor Is Concerned That Accounts Receivable May Be Understated

Essay

Correct Answer:VerifiedShow Answer

Correct Answer:
Verified