Indicate Which of the Following Audit Procedures, Used as Tests

question 3

Essay

Indicate which of the following audit procedures, used as tests of controls, do not involve audit sampling.
1. Observing and evaluating segregation of duties.
2. Testing of whether sales invoices are supported by authorized customer orders and shipping documents.
3. Reviewing entity's procedures for accounting for the numerical sequence of shipping documents.
4. Examining sales orders for proper credit approval.
5. Recomputing the information on copies of sales invoices.
6. Comparing the average days outstanding in accounts receivable with industry averages.

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Definitions:

Period's End

Refers to the conclusion of a specific accounting or reporting period, such as the end of a quarter or fiscal year.

Book Value

The net value of an asset as recorded on a company's balance sheet, calculated by subtracting accumulated depreciation from the original purchase cost.

Market Value

The present rate at which a service or asset is available for purchase or sale.

Net Income

Net income is the total amount of profit a company earns after subtracting all of its expenses, taxes, and costs from its total revenue.