An Internal Control Questionnaire for Evaluating the Occurrence Objective of Revenues

question 28

Multiple Choice

An internal control questionnaire for evaluating the occurrence objective of revenues would not include which of the following questions?

• A) Is customer credit approved before orders are shipped?
• B) Are customer statements mailed monthly by the accounts receivable department?
• C) Are direct confirmations of receivables obtained periodically by the internal auditor?
• D) Are returned goods checked against necessary reports?

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Definitions:

Balance Sheet

A financial report indicating the assets, liabilities, and shareholders' equity of a company at a certain moment, which serves as a foundation for calculating returns and assessing its financial health.

Present Value

The current worth of a future sum of money or stream of cash flows, given a specified rate of return.

Annuity

A financial product that pays out a fixed stream of payments to an individual, typically used as part of a retirement strategy.

Consecutive Payments

Regular payments made in a sequence, without interruption, over a specified period.