Question 1
2 out of 2 points
Which of the following is the principle “weakness” of using negative confirmations for your tests of details of balances for accounts receivable?
Question 2
2 out of 2 points
Audit procedures designed to uncover credit sales made after the client’s fiscal year end that relate to the current year being audited provide evidence for which of the following audit objective?
Question 3
2 out of 2 points
Most tests of accounts receivable are based on what schedule, file, or listing?
Question 4
2 out of 2 points
Analytical procedures:
Question 5
2 out of 2 points
Because of its central role in auditing of accounts receivable, which of the following would normally be one of the first items tested?
Question 6
2 out of 2 points
Communication addressed to the debtor requesting him or her to confirm whether the balance as stated on the communication is correct or incorrect is a:
Question 7
2 out of 2 points
Tests of which balance-related audit objective are normally performed first in an audit of the sales and collection?
Question 8
2 out of 2 points
The net realizable value of accounts receivable is equal to:
Question 9
2 out of 2 points
The most important test of details of balances to determine the existence of recorded accounts receivable is:
Question 10
2 out of 2 points
A type of positive confirmation known as a blank confirmation:
Question 11
2 out of 2 points
For most audits, a proper cash receipts cutoff is less important than the sales cutoff because the improper cutoff of cash:
Question 12
2 out of 2 points
When do most companies record sales returns and allowances?
Question 13
2 out of 2 points
The most important aspect of evaluating the client’s method of obtaining a reliable cutoff is to:
Question 14
2 out of 2 points
When designing tests of details of balances, an important point to remember is:
Question 15
2 out of 2 points
The two primary classes of transactions in the sales and collection cycle are:
Question 16
2 out of 2 points
The appropriate assumption to make regarding the overall percent of error in those population items containing an error is:
Question 17
2 out of 2 points
Which of the following is not a type of statistical method that provides results in dollar terms?
Question 18
2 out of 2 points
If acceptable audit risk is increased, acceptable risk of incorrect acceptance should be:
Question 19
2 out of 2 points
The final step in the evaluation of the audit results is the decision to:
Question 20
2 out of 2 points
Monetary unit sampling is not particularly effective at detecting:
Question 21
2 out of 2 points
If the population is not considered acceptable, one step the auditor is likely to take is to:
Question 22
2 out of 2 points
When selecting a sample size for substantive tests of balances which factor, other factors being equal, would result in a larger sample?
Question 23
2 out of 2 points
When the sample selection is done using probability proportional to size sample selection (PPS):
Question 24
2 out of 2 points
You are auditing Nelson and Company and determined that the sample results support a conclusion that the account is materially misstated, when in fact it was not misstated. This illustrates the risk of:
Question 25
2 out of 2 points
The method used to measure the estimated total error amount in a population when there is both a recorded value and an audited value for each item in the sample is:
Question 26
2 out of 2 points
The word below that best explains the relationship between required sample size and the acceptable risk of incorrect acceptance is:
Question 27
2 out of 2 points
If an auditor concludes that internal controls are likely to be effective, the preliminary assessment of control risk can be reduced, leading to which of the following impacts on the acceptable risk of incorrect acceptance?
Question 28
2 out of 2 points
When using monetary unit sampling, the recorded dollar population is a definition of all the items in the:
Question 29
2 out of 2 points
In monetary unit sampling, a sampling interval of 900 means that:
Question 30
2 out of 2 points
If an auditor desires a greater level of assurance in auditing a balance, the acceptable risk of incorrect acceptance: