To Determine Whether Sales Transactions Have Been Recorded in the Proper

question 10

Multiple Choice

To determine whether sales transactions have been recorded in the proper accounting period, the auditor performs cutoff tests. Which of the following best describes the overall approach used when performing cutoff tests?

• A)Ascertain that management has included in the representation letter a statement that transactions have been accounted for in the proper accounting period.
• B)Analyze transactions occurring within a few days before and after year-end.
• C)Confirm year-end transactions with regular customers.
• D)Examine cash receipts in the subsequent period.

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Definitions:

Human Resource Management

The strategic approach to the recruitment, management, development, and well-being of an organization's employees.

Subjective Performance

Evaluation of an employee's performance based on personal judgments rather than measurable outcomes.

Opinion

A personal view, attitude, or appraisal formed about something, not necessarily based on fact or knowledge.

Central Tendency Bias

A tendency to rate all individuals or situations as average or neutral, avoiding extreme judgments in assessments.