The Control Objective Associated with Selecting a Sample of Cash

question 52

Multiple Choice

The control objective associated with selecting a sample of cash receipts remittance lists
(or daily cash reports) and tracing them through to the cash receipts journal is:

• A)Validity
• B)Completeness
• C)Existence
• D)Authorization

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Definitions:

Earnings Before Interest

A company's earnings calculated before interest expenses have been deducted, often referred to as EBIT (Earnings Before Interest and Taxes).

Tax Authorities

Governmental agencies responsible for the collection of taxes, enforcement of tax laws, and the administration of tax policy.

Net Sales

Revenue from the sale of goods or services after the deduction of returns, allowances for damaged or missing goods, and discounts.

P/E Ratio

Stands for Price-to-Earnings Ratio, which measures a company's current share price relative to its per-share earnings, often used to gauge valuation.