Cutoff Tests Designed to Detect Purchases Made Before the End

question 49

Multiple Choice

Cutoff tests designed to detect purchases made before the end of the year that have been recorded in the subsequent year most likely would provide assurance about management's assertion of

• A)valuation or allocation.
• B)existence or occurrence.
• C)completeness.
• D)rights and obligations.

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Definitions:

Fiscal Period

A specific duration of time used for financial reporting and budgeting purposes, typically a year, quarter, or month.

Working Papers

Documents that serve as preliminary reports or studies, often used in academic or professional research to share ideas and findings before formal publication.

Audit Documents

Papers and records reviewed during an audit to assess the accuracy and compliance of financial statements and practices.

Engagement Letter

A written agreement that outlines the scope of work, terms, and responsibilities between a professional service provider and their client.