When a Client Hands the Financial Statements to the Auditor,he

question 29

Multiple Choice

When a client hands the financial statements to the auditor,he makes the following assertion about the financial statements

• A)Existence or occurrence -for classes of transactions
• B)Completeness - for account balances
• C)Valuation and allocation - for account balances
• D)Cutoff - for both classes of transactions and account balances

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Definitions:

Invoice

A document issued by a seller to a buyer, itemizing a transaction and requesting payment for goods or services provided.

Promises To Pay

Agreements or commitments by a debtor to pay a specific amount by a certain date to a creditor.

Direct Write-off Method

A method of accounting for bad debts that involves charging unpaid invoices directly to the expense account when they are determined to be uncollectible.

Allowance Method

An accounting technique used to estimate uncollectible accounts receivable and record them as an expense.