The Auditor Selects a Sample of Recorded Sales Invoices and Vouches

question 50

Multiple Choice

The auditor selects a sample of recorded sales invoices and vouches them to shipping documents. This procedure is related to which of the following assertions?

• A)Occurrence.
• B)Completeness.
• C)Accuracy.
• D)Cutoff.

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Definitions:

Asset Turnover

A financial metric assessing how well a company utilizes its assets to produce sales income.

Working Capital

A measure of a company’s liquidity; computed as current assets minus current liabilities.

Note Payable

A written agreement in which one party agrees to pay another party a definite sum of money at a future date or on demand.

Current Assets

Assets likely to be converted into cash, sold, or consumed within a year or the normal operating cycle of the business.