AUDITING EXAM 1 PRECISE REVIEW WITH CORRECT SOULUTIONS GRADED A+
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AUDITING
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AUDITING
Analytical procedures are required as a part of the: -- Procedures performed near the end of an audit
In Auditing the balance sheet, most revenue and expense accounts are also audited. Which accounts are most likely to be audited when auditing Accounts Receivable? -- Sales and Bad de...
analytical procedures are required as a part of th
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AUDITING EXAM 1 PRECISE REVIEW
Analytical procedures are required as a part of the: -✔✔- Procedures performed near the end of an
audit
In Auditing the balance sheet, most revenue and expense accounts are also audited. Which accounts are
most likely to be audited when auditing Accounts Receivable? -✔✔- Sales and Bad debt expense
Which of the following procedures would most likely be perfumed while evaluating findings at the
conclusion of an audit? -✔✔- Calculate an estimate the total of uncorrected misstatements in the
financial statements
An example of an internal control weakness is to assign the payroll department the responsibility for:
-✔✔- Authorizing increases in pay
For clients that distribute checks or cash payments and have significant payroll control weakness, which
of the following audit procedures is aimed at determining whether every name on the company payroll
is a bona fide employee actually on the job? -✔✔- A surprised observation of a paycheck distribution,
while establishing the identity of each employee receiving payment.
Which of the following is not a procedure that is designed to provide evidence about the existence of
loss contingencies? -✔✔- Confirming accounts payable
Which of the following types of matters do not generally require disclosure in the financial statements?
-✔✔- General risk contingencies
A refusal by a lawyer to furnish information related to litigation in the letter of inquiry is likely to result
in: -✔✔- Qualification of the audit report
If, after issuing an audit report, the auditors find that they have failed to perform certain significant audit
procedures they should first: -✔✔- Attempt to determine whether their report is still being relied
upon by third parties.
, Which of the following subsequent events might require an adjustment to the clients financial
statements? -✔✔- A major customer declares bankruptcy causing a material receivable to be
uncollectible.
Authorization of which of the following is least likely to be found during a review of the minutes of the
board of directors? -✔✔- Write-off of trade accounts receivable
Which of the following is not a procedure normally performed while completing the audit of a public
company? -✔✔- Update internal control questionnaire
Auditors must communicate internal control "significant deficiencies" to: -✔✔- The audit committee
Which of the following procedures is not a procedure that is completed near the end of the
engagement? -✔✔- Review cash transactions
Management estimates the companies allowance for doubtful accounts as $200,000, and the auditors
develop an estimate that suggests that the amount should be between $230,000 and $250,000, with all
points in that interval equally likely. The judgemental misstatement in this situation is: -✔✔- $30,000
Which of the following procedures would an auditor most likely perform to obtain evidence about the
occurrence of subsequent events? -✔✔- *********
One reason why the independent auditors perform analytical procedures on the clients operations is to
identify: -✔✔- Unusual transactions
It would be appropriate for the payroll accounting department to be responsible for which of the
following functions? -✔✔- Preparation of periodic governmental reports as to employees earnings
and withholding taxes
Which of the following is the best reason why auditors should consider observing a clients distribution of
regular payroll checks? -✔✔- Seperation of payroll duties is less than adequate for effective internal
control
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