You Are Conducting an Audit and Have Obtained the Following

question 79

Essay

You are conducting an audit and have obtained the following figures with respect to sales and accounts receivable:
2015 2014
Accounts receivable $ 3 343 000 $ 2 694 000
Allowance for doubtful accounts 212 150 207 660
Sales 25 640 000 24 630 000
Required:
A) What are the audit implications of these figures?
B) Identify key audit steps that you would perform for any of the above accounts.

• A) What are the audit implications of these figures?
• B) Identify key audit steps that you would perform for any of the above accounts.

Understand the nature and purpose of variable identification in statistical research.

Distinguish between various forms of statistical data representation, including pie charts and bar graphs.

Apply knowledge of statistics to interpret real-world examples and theoretical concepts in functional scenarios.

Appreciate the intricacies of statistical classifications and their implications for data analysis.

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Definitions:

Utility Function

A mathematical representation describing how a consumer ranks different bundles of goods according to levels of satisfaction.

Risk Averse

A preference for guaranteed outcomes over those with uncertainty, even if the uncertain outcomes might offer a higher expected return.

Coin-Flip Bet

A gambling proposition where the outcome is determined by the flip of a coin, representing a 50/50 chance of winning or losing.

Wealth

The abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions.