Which of the Following Audit Procedures Is Best for Identifying

question 14

Multiple Choice

Which of the following audit procedures is best for identifying unrecorded trade accounts payable?

• A)Reviewing cash disbursements recorded subsequent to the balance sheet date to determine whether the related payables apply to the prior period.
• B)Investigating payables recorded just prior to and just subsequent to the balance sheet date to determine whether receiving reports support them.
• C)Examining unusual relationships between monthly accounts payable balances and recorded cash payments.
• D)Reconciling vendors' statements to the file of receiving reports to identify items received just prior to the balance sheet date.

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Definitions:

Strategic Positioning

The process of establishing and maintaining a sustainable competitive advantage in the market.

Low-Cost Approach

A business or operational strategy focusing on minimizing costs while maintaining quality and efficiency, often to achieve a competitive advantage.

Value-Based Approach

A strategy focusing on providing and maximizing value to customers or stakeholders, often in terms of quality, service, and experience.

Research and Development (R&D)

The investigative activities a business conducts to improve existing products and procedures or to lead to the development of new products and procedures.