An Auditor Plans to Examine a Sample of 20 Checks

question 6

Multiple Choice

An auditor plans to examine a sample of 20 checks for countersignatures as prescribed by the client's internal control procedures.One of the checks in the chosen sample of 20 cannot be found.The auditor should consider the reasons for this limitation and

• A) Evaluate the results as if the sample size had been 19.
• B) Treat the missing check as a deviation for the purpose of evaluating the sample.
• C) Treat the missing check in the same manner as the majority of the other 19 checks (i.e., countersigned or not).
• D) Choose another check to replace the missing check in the sample.

Determine times interest earned ratios.

Calculate and interpret equity multipliers.

Understand and calculate accounts receivable turnover and total sales.

Determine inventory turnover.

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Definitions:

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The process of creating, manufacturing, or outputting goods and services through the combination of labor, materials, and technology.

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A period of geopolitical tension between the Soviet Union and the United States and their respective allies, from the end of World War II in 1945 until the dissolution of the Soviet Union in 1991.

Higher Education

An optional final stage of formal learning that occurs after the completion of secondary education, usually at colleges or universities.

Joe McCarthy's Downfall

The decline of Senator Joseph McCarthy's career, largely due to his unsubstantiated and aggressive tactics of accusing people of communism, resulting in censure by the Senate in 1954.