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For Each of the Following Potential Misstatements, Provide One Potential

question 96

Essay

For each of the following potential misstatements, provide one potential audit test that could be used to detect the misstatement.
•Sales included in the journals for which there was no shipment
•Sale recorded more than once
•Shipments made to nonexistent customers and recorded as sales


Definitions:

Total Amount

The aggregate sum of all units or quantities in consideration.

Pareto Optimal

A state of allocation of resources from which it is impossible to reallocate without making at least one individual worse off.

Public Goods

Goods or services that are non-excludable and non-rivalrous, meaning they are available to all and not diminished by use.

Private Consumption

Spending by households and individuals on goods and services for personal use, excluding purchases by businesses or governments.

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