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NEW QUESTION: 1
Tests designed to detect credit sales made before the end of the year that have been recorded in the
subsequent year provide assurance about management's assertion regarding:
A. Classification.
B. Cutoff.
C. Existence.
D. Accuracy.
Answer: B
Explanation:
Explanation/Reference:
Explanation:
Choice "B" is correct. Cutoff tests are designed to determine whether transactions have been recorded in
the proper period. Tests to detect credit sales made before the end of the year that have been (improperly)
recorded in the subsequent year provide assurance about both cutoff and completeness (i.e., whether all
current year sales have been properly included).
Choice "A" is incorrect. Cutoff tests do not determine whether the components of the financial statements
are properly presented, described and disclosed (classification).
Choice "C" is incorrect. The cutoff testing described is designed to identify sales recorded in the
subsequent year that more properly belong in the current year. This relates to the timing of the entry, not to
its accuracy.
Choice "D" is incorrect. To test existence, the auditor would need to start with sales that were recorded in
the current year, not those recorded in the subsequent year.

NEW QUESTION: 2

A. Option A
B. Option C
C. Option B
D. Option D
Answer: D

NEW QUESTION: 3
Drag and Drop .. Not all will be used
Select and Place:

Answer:
Explanation: