Which of the Following Is the Best Audit Procedure for the Detection

question 45

Multiple Choice

Which of the following is the best audit procedure for the detection of lapping?

• A)Comparison of postings of cash receipts to accounts with the details of cash deposits.
• B)Confirmation of the cash balance.
• C)Reconciliation of the cash account balances.
• D)Preparing a proof of cash.

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Definitions:

Statistically Significant

A determination that a result from data analysis is unlikely to have occurred by chance, indicating a meaningful difference or relationship.

Consumption Function

An economic formula representing the relationship between total consumption and gross national income, depicting how income changes affect spending levels.

Aggregate Income

The total income received by all factors of production in an economy during a given period, including wages, rents, and profits.

Aggregate Income

The total income earned by all individuals or entities in an economy, including wages, profits, rents, and investment earnings.