Audit Tests to Detect Lapping Involve Which of the Following

question 1

Multiple Choice

Audit tests to detect lapping involve which of the following?

• A) confirm accounts payable.
• B) compare details of cash payments journal entries with the details of corresponding daily deposit slips.
• C) use a bank cut-off statement.
• D) make a surprise cash count of currency and customers cheques on hand and oversee the banking of these amounts

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Definitions:

Journal Entry

A record of a financial transaction within a company's accounting system, indicating the affected accounts and their respective debit or credit amounts.

Interest Rate

The percentage charged on borrowed money or paid to the lender for the use of their money.

Mortgage

A loan specifically used to purchase real estate, where the property itself serves as collateral for the loan.

Monthly Payments

Regular payments made over a period, often referring to loan repayments, lease payments, or subscriptions that are due once per month.