An Auditor Is Determining Whether an Issuance of Notes Payable

question 108

Multiple Choice

An auditor is determining whether an issuance of notes payable for cash was correctly recorded. Her or his best course of action would be to

• A) confirm with the bond trustee as to the amount of bonds issued.
• B) confirm with the underwriter as to the appropriate market yield on the bonds.
• C) trace the cash received from the proceeds to the accounting records.
• D) verify that the amount was included in a footnote disclosure.

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Definitions:

Temporal Bone

A pair of bones that form parts of the side of the skull and house the structures of the ears.

Mandible

The lower jawbone, which is the largest and strongest bone in the human face, involved in chewing and forming the lower part of the facial skeleton.

Foramen

A natural opening or passage, especially in a bone, through which nerves or blood vessels pass.

Tubercle

Lump on a bone.