In Searching for Unrecorded Liabilities, the Purpose of the Audit

question 8

Multiple Choice

In searching for unrecorded liabilities, the purpose of the audit procedure to "examine underlying documentation for subsequent cash disbursements" is to

• A) uncover liabilities on the balance sheet which should not have been recorded until a subsequent period.
• B) find the documentation relating to a cash disbursement.
• C) uncover payments made in a subsequent accounting period for liabilities that existed at the balance sheet date.
• D) uncover cash disbursements recorded in a subsequent accounting period which should be recorded in this period.

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Definitions:

Fugitive Slave Act

Legislation passed in the United States that allowed for the capture and return of runaway enslaved people within the territory of the United States.

States' Rights

The principle or belief that certain rights are reserved to the states as distinct from the federal government, often invoked in debates over the balance of powers.

Know-Nothing Party

A mid-19th century American political movement that was anti-immigrant and anti-Catholic, advocating for strict regulations on immigration and naturalization.

Native-born Americans

Individuals born in the United States, as opposed to those who have immigrated to the country and obtained citizenship.