In Determining Whether Transactions Have Been Recorded, the Direction of the Audit

question 50

Multiple Choice

In determining whether transactions have been recorded, the direction of the audit testing should start from the:

• A)General ledger balances.
• B)Adjusted trial balance.
• C)Original source documents.
• D)General journal entries.

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Definitions:

Indorsement

An endorsement, in a financial context, refers to the act of signing the back of a negotiable instrument, which allows for the legal transfer of the instrument’s ownership. If "Indorsement" was misspelled and meant to signify a general approval or support, the term is not accurate.

Reimburse

To pay back or compensate for expenses incurred or losses sustained.

Liable

Being legally responsible for something, typically involving financial compensation or reparations.

Encodes Information

Involves converting data or information into a particular form, especially to prevent unauthorized access or understanding.