A Client Has a Separate Sales Group for Its Largest

question 71

Multiple Choice

A client has a separate sales group for its largest "preferred" customers. This is a select group of customers that normally make purchases in excess of $250,000 and often have accounts receivable balances in excess of $1 million. Which of the following audit procedures would the auditor most likely perform?

• A)Prepare a schedule of purchases and payments for these customers.
• B)Send out negative confirmations on a large sample of these customers.
• C)Inquire of the sales manager regarding the accounts receivable terms.
• D)Send out positive confirmations on a large sample of these customers.

---

Definitions:

Multifactorial Causation

The concept that many factors (genetic, environmental, behavioral) collectively influence the outcome of a disease or condition.

Psychoanalytic Approach

A method in psychology which posits that human behavior is influenced by unconscious motives and conflicts originating from childhood experiences.

Empirical Explanation

A clarification or interpretation based on observation, experimentation, or experience rather than theory.

Situational Factors

Elements present in an environment that can influence the behavior or feelings of individuals.