When Testing the Occurrence Assertion, the Auditor May

question 28

Multiple Choice

When testing the occurrence assertion, the auditor may:

• A) examine supporting documentation for paid invoices.
• B) examine open purchase orders.
• C) examine the appropriate journals for evidence of posting.
• D) All of the above.

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Definitions:

Ordering Costs

Expenses related to procuring inventory.

Shipping Costs

Expenses associated with the transportation of goods from the seller to the buyer, which can include packaging, postage, and handling fees.

Purchase Order

A formal document sent by a buyer to a seller with details about a purchase, including quantities and prices of products.

Purchase Contract

A purchase contract is a legal agreement between a buyer and seller detailing the terms and conditions under which a product or property is sold.