Which of the Following Would Most Likely Be Detected by an Auditor's

question 45

Multiple Choice

Which of the following would most likely be detected by an auditor's review of a client's sales cutoff?

• A) lapping of year-end accounts receivable
• B) excessive sales discounts
• C) unrecorded sales for the year
• D) unauthorised goods returned for credit

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Definitions:

Cash

Money in the form of bills or coins; physical currency.

Check Outstanding

A written, dated, and signed instrument that directs a bank to pay a specific sum of money to the bearer, which has been issued but not yet cashed or cleared.

Bank Reconciliation

The analysis that details the items responsible for the difference between the cash balance reported in the bank statement and the balance of the cash account in the ledger.

Debit Memo

A document issued by a vendor to a customer, recording an increase in the amount a customer owes to the vendor due to various reasons like returned goods or underbilling.