The Key Assertion an Auditor Would Be Testing When Examining

question 42

Multiple Choice

The key assertion an auditor would be testing when examining a sales invoice to determine if it was billed to the correct customer would be ________.

• A)valuation and accuracy
• B)classification
• C)rights and obligations
• D)cutoff

---

Definitions:

Transfer Price

The price charged for goods or services transferred between departments or divisions of the same company.

Variable Cost

Costs that vary directly with the level of production or sales volume, increasing as business activity rises and decreasing as it falls.

Transfer Price

The price at which goods or services are sold between divisions within the same company.

Variable Cost

Expenses that vary directly with the level of production or sales volume, such as raw materials and labor.