Below Are Five Audit Procedures,all of Which Are Tests of Transactions

question 67

Essay

Below are five audit procedures,all of which are tests of transactions associated with the audit of the acquisition and payment cycle.Also below are the six general transaction-related audit objectives and the five management assertions.For each audit procedure,indicate (1)its audit objective,and (2)the management assertion being tested. 1.Foot the purchases journal and trace the totals to the related general ledger accounts.
(1)________.
(2)________.
2.Recompute the cash discounts taken by the client.
(1)________.
(2)________.
3.Compare dates on cancelled checks with the bank cancellation date.
(1)________.
(2)________.
4.Trace from a sample of cancelled checks to the cash disbursements journal.
(1)________.
(2)________.
5.Examine supporting documentation for a sample of transactions for authorized payee and amount and to determine services or goods were received.
(1)________.
(2)________.

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Definitions:

Banned

Prohibited by regulation or law from being sold, used, or practiced, often due to safety, health, or ethical concerns.

Nonfinancial Businesses

Enterprises primarily engaged in the production or supply of goods and services, excluding those in the financial services sector like banks or investment companies.

Marketable Securities

Financial instruments and assets that can easily be converted into cash without significantly affecting their market price.

Investment Bankers

Investment bankers are financial specialists who assist corporations and governments in raising capital, advising on mergers and acquisitions, and offering investment advice.