ROGER CPA AUDIT FINAL QUESTIONS & ANSWERS

X Company prepares a sales invoice, using a pre-printed sequentially numbered form, upon receipt of a copy of a bill of lading from the shipping department indicating that goods have been shipped. An auditor wishes to obtain evidence that all sales that occurred during the period were actually recorded. Which of the following procedures would likely be most effective for that purpose? A. Trace entries from the sales journal to sales invoices and customer purchase orders. B. Trace a sample of receiving reports to the sales journal. C. Trace a sample of sales invoices to bills of lading. D. Trace a sample of bills of lading to the sales journal. - Answer-D. Trace a sample of bills of lading to the sales journal. X Company prepares a sales invoice, using a pre-printed, sequentially numbered form, upon receipt of a copy of a bill of lading from the shipping department indicating that goods have been shipped. An auditor wishes to obtain evidence that all sales that that were recorded during the period actually occurred. Which of the following procedures would likely be most effective for that purpose? A. Trace entries from the sales journal to sales invoices and bills of lading. B. Trace a sample of receiving reports to the sales journal. C. Trace a sample of sales invoices to bills of lading. D. Trace a sample of bills of lading to the sales journal. - Answer-A. Trace entries from the sales journal to sales invoices and bills of lading. X Company is concerned that it does not have enough employees to ensure adequate segregation of duties in its revenue cycle. Which of the following may be performed by the same individual? A. Approving sales and delivering the inventory from the storage area to the shipping area. B. Opening the mail and reconciling the perpetual inventory records to the physical count. C. Opening the mail and recording entries in the sales journal. D. Recording entries in the sales journal and delivering inventory from the storage area to the shipping area. - Answer-B. Opening the mail and reconciling the perpetual inventory records to the physical count. W