In Vouching Revenue Transactions, the Auditor Selects a Sample of Sales

question 110

Multiple Choice

In vouching revenue transactions, the auditor selects a sample of sales invoices to vouch to the supporting source documents in order to provide evidence pertaining to four assertions.Which ones are these (choose two options) ?

• A)Occurrence and accuracy
• B)Classification and cutoff
• C)Completeness and existence
• D)Understandability and classification

---

Definitions:

Capital Budget

The process and plan for determining and allocating resources for capital or investment projects within an organization.

Common Stock

Equity ownership in a company, granting holders voting rights and a share in the company’s profits through dividends.

WACC

A calculation known as the Weighted Average Cost of Capital determines a corporation's capital costs by proportionally weighting different categories of capital.

Flotation Costs

Expenses incurred by a company in issuing new securities, including underwriting, legal, and registration fees.