ACC 403 Quiz 7 Set 2

ACC 403 Quiz 7 Set 2

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1.       The auditor's objectives for the sales and cash collections activities when the client is primarily an e-commerce business as compared to a "bricks and mortar" business are:

2.       A ________ is a document that is matched with the customer order to assure that the correct quantity and type of goods are shipped.

3.       What event initiates a transaction in the sales and collection cycle?

4.       Who is generally responsible for opening receipts when a company uses a lockbox to speed the handling of cash receipts?

5.       Which of the following is not one of the five classes of transactions included in the sales and collection cycle?

6.       A document sent to each customer showing his or her beginning accounts receivable balance and the amount and date of each sale, cash payment received, any debit or credit memo issued, and the ending balance is the:

7.       Which of the following is an account that is not affected by the sales and collection cycle?

8.       Some companies have customers send payments directly to an address maintained by a bank. This is called a(n) ________ system.

9.       To test for recorded sales for which there were no actual shipments, the auditor vouches from the:

10.   Which of the following is not a business function within the "Sales" class of transactions?

11.   The document used to indicate to the customer the amount of a sale and payment due date is the:

12.   A document prepared to initiate shipment of the goods sold by an independent shipper is the:

13.   The total of the individual account balances in the accounts receivable subsidiary ledger should equal the:

14.   Most companies recognize sales revenue when:

15.   The ________ is a contract between a carrier (e.g., a trucking company) and the seller of goods that dictates the details surrounding the shipment of goods.

16.   Attributes sampling would be an appropriate method to use on which one of the following procedures in an audit program?

17.   When using statistical sampling, the auditor would most likely require a smaller sample if the:

18.   The exception rate the auditor will permit in the population and still be willing to reduce the assessed level of control risk is called the:

19.   Which of the following occurrences would be least likely to warrant further audit attention for the auditor?

20.   Auditors often use the ________ to determine the estimated population exception rate.

21.   Which of the following is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population?

22.   The most serious shortcoming of the haphazard sample selection method is:

23.   When auditors wish to evaluate a sample statistically, an acceptable selection method is:

24.   To determine if a sample is truly representative of the population, an auditor would be required to:

25.   The process which requires the calculation of an interval and then selects the items based on the size of the interval is:

26.   Simple random sampling:

27.   A sample in which the characteristics of the sample are the same as those of the population is a(n):

28.   If the auditor decides to assess control risk at the moderate level in a private company audit, when in previous years the auditor set control risk at the maximum level, then tests of controls for the current year would be:

29.   There are three phases in both statistical and nonstatistical sampling. The first phase is to:

30.   Rodgers CPA believes that the rate of client billing errors is 4% and has established a tolerable deviation rate of 6%. In auditing client invoices Rodgers should use:

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