Which of the Following Would Be the Best Audit Procedure

question 101

Multiple Choice

Which of the following would be the best audit procedure to use to determine if a division's unusually high sales and gross margin for November and December were the result of fraudulently recorded sales?

• A) Trace a sample of shipping documents to related sales invoices to verify proper billing.
• B) Confirm accounts receivable balances with customers.
• C) Compare sales and gross margin totals with those of the previous ten months and the first month of the following year.
• D) Use regression analysis techniques to estimate the sales and cost of goods sold for November and December.

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