Which of the Following Audit Procedures Would an Auditor Most

question 37

Multiple Choice

Which of the following audit procedures would an auditor most likely perform to test controls relating to management's valuation assertion for accounts receivable?

• A)Verify that extensions and footings on the entity's sales invoices and monthly customer statements have been recomputed.
• B)Inspect the entity's reports of prenumbered shipping documents that have not been recorded in the sales journal.
• C)Compare the invoiced prices on prenumbered sales invoices to the entity's authorized price list.
• D)Inquire about the entity's credit-granting policies and test whether credit checks have been consistently applied to new customers.

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Definitions:

Natural Family

A social unit typically consisting of parents and their children by blood or adoption, emphasizing biological connections.

Fictive Kin

Individuals not related by blood or marriage who are nonetheless considered to be family due to close emotional ties or bonds.

Circumplex Model

is a theoretical framework used to evaluate the levels of cohesion and adaptability within family systems, aiding in the understanding of family dynamics.

Adaptability

A family’s ability to modify and respond to changes in the family’s power structure and roles.