An Internal Control Questionnaire Indicates That an Approved Receiving Report

question 34

Multiple Choice

An internal control questionnaire indicates that an approved receiving report is required to accompany every check request for payment of merchandise.Which of the following procedures provides the best evidence on operating effectiveness?

• A)Select and examine receiving reports and test whether the related canceled checks are dated no earlier than the receiving reports.
• B)Select and examine receiving reports and test whether the related canceled checks are dated no later than the receiving reports.
• C)Select and examine canceled checks and test whether the related receiving reports are dated no earlier than the checks.
• D)Select and examine canceled checks and test whether the related receiving reports are dated no later than the checks.

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Definitions:

Price Levels

A summary measure of the current prices for goods and services across the whole economic output.

Shortage

A situation where the demand for a product exceeds its supply at a particular price.

Price Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in its price, with higher elasticity indicating greater sensitivity.

Ticket Revenue

The income generated through the sale of tickets for events, performances, or transportation services.