AUD 3 Internal Control 13 - 3 The Revenue Cycle (Sales Revenue, AR, Cash Receipts)

Question 1

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

The assertions are discussed in detail in another section, but some specific applications of these assertions are frequently tested in discussing the revenue cycle.

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Answer 1

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

The assertions are discussed in detail in another section, but some specific applications of these assertions are frequently tested in discussing the revenue cycle.

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Question 2

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and e____s have been recorded in the proper accounts and information is presented and described clearly.

Answer 2

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 3

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts

Answer 3

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Tran_______s and events have been recorded in the proper accounts

Question 4

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been re____ed in the proper accounts

Answer 4

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts

Question 5

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper acc____s and information is presented and described clearly.

Answer 5

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 6

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is pre____ed and described clearly.

Answer 6

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 7

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and des____ed clearly.

Answer 7

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 8

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described cl___ly.

Answer 8

Revenue Cycle

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 9

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 9

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• U = Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 10

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 10

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 11

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• P = Presentation and Disclosure
– Ma_________ asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Answer 11

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 12

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that a__ sales to employees have been properly identified in the statements and notes as related party transactions.

Answer 12

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 13

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been pr_____ly identified in the statements and notes as related party transactions.

Answer 13

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 14

Revenue Cycle

• P = Presentation and Disclosure
– Management a_____s that all sales to employees have been properly identified in the statements and notes as related party transactions.

Answer 14

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 15

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and n___s as related party transactions.

Answer 15

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 16

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party tran_______s.

Answer 16

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 17

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as re___ed party transactions.

Answer 17

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 18

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all s___s to employees have been properly identified in the statements and notes as related party transactions.

Answer 18

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 19

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The au____ may review sales invoices for specific sales to employees

Answer 19

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

Question 20

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales in_____s for specific sales to employees

Answer 20

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

Question 21

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then t___e these invoices to the general ledger entry

Answer 21

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry

Question 22

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger en___ to see if they are posted to the “due from employees” account.

Answer 22

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 23

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these in______s to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 23

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 24

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are p___ed to the “due from employees” account.

Answer 24

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 25

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” acc_____.

Answer 25

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 26

Revenue Cycle

• P = Pres________ and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 26

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 27

Revenue Cycle

• P = Presentation and Disc______
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 27

Revenue Cycle

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 28

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Answer 28

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• P = Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees

and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 29

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Answer 29

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 30

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• E = Existence or Occurrence (Vouching)
– Man_________ asserts that all sales that have been recorded actually have taken place

Answer 30

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

Question 31

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been re____ed actually have taken place

Answer 31

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

Question 32

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have ta___ place

Answer 32

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

Question 33

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that a__ sales that have been recorded actually have taken place

Answer 33

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place

Question 34

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may sel___ a sales invoice

Answer 34

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice

Question 35

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales in_____ and vouch from the sales invoice to the bill of lading

Answer 35

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

Question 36

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and v___h from the sales invoice to the bill of lading

Answer 36

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

Question 37

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the b___ of lading

Answer 37

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading

Question 38

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of l__ing in order to ensure that

items billed to customers were based on actual shipments.

Answer 38

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 39

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items b___ed to customers were based on actual shipments.

Answer 39

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 40

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on ac___l shipments.

Answer 40

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 41

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual ship____s.

Answer 41

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 42

Revenue Cycle

• E = Exis______ or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Answer 42

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 43

Revenue Cycle

• E = Existence or Occu______ (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Answer 43

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 44

Revenue Cycle

• E = Existence or Occurrence (Vo___ing)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Answer 44

Revenue Cycle

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that

items billed to customers were based on actual shipments.

Question 45

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 45

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• E = Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 46

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 46

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 47

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• R = Rights and Obligations
– Ma________ asserts the right to collect receivables.

Answer 47

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• R = Rights and Obligations
– Management asserts the right to collect receivables.

Question 48

Revenue Cycle

• R = Rights and Obligations
– Management asserts the r___t to collect receivables.

Answer 48

Revenue Cycle

• R = Rights and; Obligations
– Management asserts the right to collect receivables.

Question 49

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect rec_______s.

Answer 49

Revenue Cycle

• R = Rights andObligations
– Management asserts the right to collect receivables.

Question 50

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can v___h from postings in the subsidiary receivables ledger for a specific client

Answer 50

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

Question 51

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from p___ings in the subsidiary receivables ledger for a specific client

Answer 51

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

Question 52

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the sub___iary receivables ledger for a specific client

Answer 52

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

Question 53

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables led___ for a specific client

Answer 53

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

Question 54

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the s___s order, bill of lading, and sales invoice,

Answer 54

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

Question 55

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

Answer 55

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

Question 56

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales in____e,

Answer 56

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

Question 57

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

b__k to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

Answer 57

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

Question 58

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to es___lish that the goods were ordered, shipped, and billed,

Answer 58

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

Question 59

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were or___ed, shipped, and billed,

Answer 59

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

Question 60

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, sh___ed, and billed,

Answer 60

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed,

Question 61

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and b___ed, giving the company the right to collect.

Answer 61

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 62

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to co____t.

Answer 62

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 63

Revenue Cycle

• R = Ri___s and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 63

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 64

Revenue Cycle

• R = Rights and Obli______s
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 64

Revenue Cycle

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client

back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 65

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Answer 65

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• R = Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice,

in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 66

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Answer 66

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 67

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has re____ed all sales that have taken place.

Answer 67

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

Question 68

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded a__ sales that have taken place.

Answer 68

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

Question 69

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may se____ a bill of lading

Answer 69

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

Question 70

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then tr___ from the bill of lading to the sales invoice

Answer 70

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

Question 71

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the s___s invoice

Answer 71

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

Question 72

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all s___ped goods have been billed to customers.

Answer 72

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

Question 73

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that a__ shipped goods have been billed to customers.

Answer 73

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

Question 74

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been b___ed to customers.

Answer 74

Revenue Cycle

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading

and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

Question 75

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• C = Com_______s (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 75

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• C = Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice

in order to ensure that all shipped goods have been billed to customers.

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 76

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 76

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 77

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that rec_______s are likely to be collected.

Answer 77

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

Question 78

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be coll___ed.

Answer 78

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

Question 79

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of cr___t approval before shipment

Answer 79

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

Question 80

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval bef___ shipment

Answer 80

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

Question 81

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers l___ly to pay.

Answer 81

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 82

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is o_ly shipping to customers likely to pay.

Answer 82

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 83

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to p__.

Answer 83

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 84

Revenue Cycle

• V = Val_____, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Answer 84

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 85

Revenue Cycle

• V = Valuation, Allo______ and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Answer 85

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 86

Revenue Cycle

• V = Valuation, Allocation and Ac_____cy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Answer 86

Revenue Cycle

• V = Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment

in order to determine that the company is only shipping to customers likely to pay.

Question 87

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 87

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place (be sure not to confuse this with the previous assertion).

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 88

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Answer 88

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Question 89

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Unders_______ and Classification

Answer 89

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification

Question 90

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Class_______

Answer 90

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification

Question 91

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Pres________ and Disclosure

Answer 91

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure

Question 92

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Dis________

Answer 92

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure

Question 93

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Exis______ or Occurrence (Vouching)

Answer 93

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)

Question 94

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occ_______ (Vouching)

Answer 94

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)

Question 95

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (V___hing)

Answer 95

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)

Question 96

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obli_________

Answer 96

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations

Question 97

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Comp________ (Tracing) and Cutoff

Answer 97

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff

Question 98

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (T___ing) and Cutoff

Answer 98

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff

Question 99

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and C_____

Answer 99

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff

Question 100

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Val_______, Allocation and Accuracy

Answer 100

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Question 101

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allo______ and Accuracy

Answer 101

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Question 102

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Acc_____

Answer 102

Revenue Cycle

Examples related to each assertion follow (U-PERCV):

• Understandability and Classification
• Presentation and Disclosure
• Existence or Occurrence (Vouching)
• Rights and Obligations
• Completeness (Tracing) and Cutoff
• Valuation, Allocation and Accuracy

Question 103

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Another way to look at the assertions:

As indicated, the auditor’s understanding of the system of internal control is to determine if the financial statement assertions are correct and may be relied upon.

In relation to sales for events and transactions (CPA-CO):

Answer 103

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

Another way to look at the assertions:

As indicated, the auditor’s understanding of the system of internal control is to determine if the financial statement assertions are correct and may be relied upon.

In relation to sales for events and transactions (CPA-CO):

Question 104

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

In relation to sales for events and transactions (CPA-CO):

• Completeness
• Period Cutoff
• Accuracy
• Classification (Sorted)
• Occurrence

Answer 104

Revenue Cycle
(Sales Revenue / Accounts Receivable / Cash Receipts)

In relation to sales for events and transactions (CPA-CO):

• Completeness
• Period Cutoff
• Accuracy
• Classification (Sorted)
• Occurrence

Question 105

Ultimately, the reason an auditor cares about the internal control __________ is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Answer 105

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Question 106

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement __________ are correct and therefore may be relied upon.

Answer 106

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Question 107

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are ________ and therefore may be relied upon.

Answer 107

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Question 108

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be _____ upon.

Answer 108

Ultimately, the reason an auditor cares about the internal control structure is that it relates to whether the financial statement assertions are correct and therefore may be relied upon.

Question 109

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Transactions and events have been recorded in the proper accounts and information is presented and described clearly.”

Answer 109

Financial statement assertion (U-PERCV)

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 110

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.”

Answer 110

Financial statement assertion (U-PERCV)

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions. The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 111

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.”

Answer 111

Financial statement assertion (U-PERCV)

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 112

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.”

Answer 112

Financial statement assertion (U-PERCV)

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 113

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.”

Answer 113

Financial statement assertion (U-PERCV)

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 114

The paragraph below describe which financial statement assertion (U-PERCV) ?

“Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.”

Answer 114

Financial statement assertion (U-PERCV)

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 115

Examples related to each assertion (U-PERCV):

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 115

Examples related to each assertion (U-PERCV):

• Understandability and Classification
– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

• Presentation and Disclosure
– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

• Existence or Occurrence (Vouching)
– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

• Rights and Obligations
– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

• Completeness (Tracing) and Cutoff
– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

• Valuation, Allocation and Accuracy
– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 116

Examples related assertion (U-PERCV):

• U______________ and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Answer 116

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 117

Examples related assertion (U-PERCV):

• Understandability and C____________

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Answer 117

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 118

Examples related assertion (U-PERCV):

• Understandability and Classification

– _____________ and events have been recorded in the proper accounts and information is presented and described clearly.

Answer 118

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 119

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and ______ have been recorded in the proper accounts and information is presented and described clearly.

Answer 119

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 120

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been _______ in the proper accounts and information is presented and described clearly.

Answer 120

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 121

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the ______ accounts and information is presented and described clearly.

Answer 121

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 122

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described ________.

Answer 122

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 123

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is ________ and described clearly.

Answer 123

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 124

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and ________ clearly.

Answer 124

Examples related assertion (U-PERCV):

• Understandability and Classification

– Transactions and events have been recorded in the proper accounts and information is presented and described clearly.

Question 125

Examples related assertion (U-PERCV):

• _____________ and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Answer 125

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 126

Examples related assertion (U-PERCV):

• Presentation and ___________

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Answer 126

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 127

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all _____ to employees have been properly identified in the statements and notes as related party transactions.

Answer 127

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

Question 128

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales _________ for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 128

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 129

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then _____ these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Answer 129

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 130

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general _______ entry to see if they are posted to the “due from employees” account.

Answer 130

Examples related assertion (U-PERCV):

• Presentation and Disclosure

– Management asserts that all sales to employees have been properly identified in the statements and notes as related party transactions.

The auditor may review sales invoices for specific sales to employees and then trace these invoices to the general ledger entry to see if they are posted to the “due from employees” account.

Question 131

Examples related assertion (U-PERCV):

• _________ or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Answer 131

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Question 132

Examples related assertion (U-PERCV):

• Existence or _________ (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Answer 132

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Question 133

Examples related assertion (U-PERCV):

• Existence or Occurrence (_________)

– Management asserts that all sales that have been recorded actually have taken place.

Answer 133

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Question 134

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been _________ actually have taken place.

Answer 134

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Question 135

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all _____ that have been recorded actually have taken place.

Answer 135

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

Question 136

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales ______ and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Answer 136

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 137

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and ______ from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Answer 137

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 138

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the _____________ in order to ensure that items billed to customers were based on actual shipments.

Answer 138

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 139

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items _____ to customers were based on actual shipments.

Answer 139

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 140

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on ______ shipments.

Answer 140

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 141

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual ___________.

Answer 141

Examples related assertion (U-PERCV):

• Existence or Occurrence (Vouching)

– Management asserts that all sales that have been recorded actually have taken place.

The auditor may select a sales invoice and vouch from the sales invoice to the bill of lading in order to ensure that items billed to customers were based on actual shipments.

Question 142

Examples related assertion (U-PERCV):

• ______ and Obligations

– Management asserts the right to collect receivables.

Answer 142

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

Question 143

Examples related assertion (U-PERCV):

• Rights and ___________

– Management asserts the right to collect receivables.

Answer 143

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

Question 144

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the _____ to collect receivables.

Answer 144

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

Question 145

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect ___________.

Answer 145

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

Question 146

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can _______ from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 146

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 147

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from ________ in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 147

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 148

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the ________ receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 148

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 149

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary __________ ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 149

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 150

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ________ for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 150

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 151

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales _____, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 151

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 152

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, ____________, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 152

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 153

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales _______, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Answer 153

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 154

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ________, shipped, and billed, giving the company the right to collect.

Answer 154

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 155

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and _____, giving the company the right to collect.

Answer 155

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 156

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, _______, and billed, giving the company the right to collect.

Answer 156

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 157

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the _____ to collect.

Answer 157

Examples related assertion (U-PERCV):

• Rights and Obligations

– Management asserts the right to collect receivables.

An auditor can vouch from postings in the subsidiary receivables ledger for a specific client back to the sales order, bill of lading, and sales invoice, in order to establish that the goods were ordered, shipped, and billed, giving the company the right to collect.

Question 158

Examples related assertion (U-PERCV):

• _____________ (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Answer 158

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Question 159

Examples related assertion (U-PERCV):

• Completeness (Tracing) and ______

– Management asserts that it has recorded all sales that have taken place.

Answer 159

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Question 160

Examples related assertion (U-PERCV):

• Completeness (_______) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Answer 160

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Question 161

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has __________ all sales that have taken place.

Answer 161

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Question 162

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded ___ sales that have taken place.

Answer 162

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

Question 163

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a _____________ and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Answer 163

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 164

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then _____ from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Answer 164

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 165

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the ______________ to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Answer 165

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 166

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales _______ in order to ensure that all shipped goods have been billed to customers.

Answer 166

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 167

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all ________ goods have been billed to customers.

Answer 167

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 168

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been _______ to customers.

Answer 168

Examples related assertion (U-PERCV):

• Completeness (Tracing) and Cutoff

– Management asserts that it has recorded all sales that have taken place.

The auditor may select a bill of lading and then trace from the bill of lading to the sales invoice in order to ensure that all shipped goods have been billed to customers.

Question 169

Examples related assertion (U-PERCV):

• _________, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Answer 169

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Question 170

Examples related assertion (U-PERCV):

• Valuation, __________ and Accuracy

– Management asserts that receivables are likely to be collected.

Answer 170

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Question 171

Examples related assertion (U-PERCV):

• Valuation, Allocation and __________

– Management asserts that receivables are likely to be collected.

Answer 171

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Question 172

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that __________ are likely to be collected.

Answer 172

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Question 173

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be ________.

Answer 173

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

Question 174

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of _____ approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 174

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 175

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval ______ shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 175

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 176

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit __________ before shipment in order to determine that the company is only shipping to customers likely to pay.

Answer 176

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 177

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is ____ shipping to customers likely to pay.

Answer 177

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.

Question 178

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to ___.

Answer 178

Examples related assertion (U-PERCV):

• Valuation, Allocation and Accuracy

– Management asserts that receivables are likely to be collected.

The auditor can test the process of credit approval before shipment in order to determine that the company is only shipping to customers likely to pay.