ACC 241 EXAM 2 ASU DALLMUS
ELABORATED 2025 EXAM A+ GRADED 100
PERCENT VERIFIED QUESTIONS AND
ANSWERS LATEST TEST BANK COLLECTION
2026 COMPLETE SOLUTIONS GRADED A+
⩥ ________ are internal controls that are performed by individuals but
rely on computer generated information. Answer: IT dependent manual
controls
⩥ A bill of lading is a (an) ________. Answer: shipping document
serving as acknowledgement of receipt of goods for delivery by a freight
carrier
⩥ A common software-based audit technique involves ________.
Answer: submitting certain test data into the client's software application
while the auditor is in control of the software
⩥ A control ensuring that sales are recorded in the sales ledger is a/an
________-level control. Answer: transaction
⩥ A dual-purpose test ________. Answer: involves the auditors
designing a test of controls and a substantive test of details to be
performed at the same time on the same transaction
,⩥ A fundamental premise of any external audit is checking assertions
and searching for evidence to either corroborate or refute these
assertions. Which of the following statements best describes the idea of
an assertion and who holds responsibility for the assertions made?
Answer: Assertions are made by the client's management, and are
implicit within the financial statements. Management holds ultimate
responsibility for the accuracy of these assertions.
⩥ A misstatement could occur with ________. Answer: All of the
choices are correct. (a classification; an account balance; a transaction)
⩥ A misstatement is defined as ________. Answer: a difference between
what is reported in the client prepared financial statements with what is
required for the item to be presented fairly in accordance with the
applicable financial reporting framework
⩥ A notable item is an item identified from the population being
analyzed that has one or more characteristics that, for a relevant
assertion, may I. Be indicative of a risk of an immaterial misstatement
not previously identified. II. Be indicative of a risk of higher risk of
material misstatement than anticipated by the auditor. III. Provide
information useful in designing or tailoring procedures to address risks
of material misstatement. Which items are correct? Answer: II and III
,⩥ A number of substantive tests of details involve ________. Answer:
matching information in the accounting records with information on
underlying documents
⩥ A reliance on controls strategy would involve ________. Answer: the
auditor performing primarily tests of controls
⩥ Accounting estimates, by their nature ________. Answer: involve
subjective decision making on the part of management
⩥ After an initial meeting with the client's senior management, an
auditor assigned to the audit of Bookbinder LLC is attempting to
understand the entity-level controls enacted by the organization. Which
of the following would represent the most appropriate way for the
auditor to achieve this understanding? Answer: The auditor should
consider reviewing company policies and procedures as well as minutes
of board of director meetings.
⩥ After auditors have assessed control risk ________. Answer: they are
in a good position to evaluate the risk of fraud
⩥ After auditors have completed testing controls and drawn a conclusion
about control risk, they ________. Answer: make decisions about the
nature, timing, and extent of substantive testing
, ⩥ After the auditor completes test of controls and draws conclusion
about control risk, the auditor makes decisions about the nature, timing,
and extent of ________. Answer: substantive testing
⩥ After the auditor has completed test of controls and drawn a
conclusion about control risk, ________. Answer: the auditor will want
to make decisions about the nature, timing and extent of substantive
testing
⩥ All substantive audit procedures performed ________. Answer: are
documented in the working papers
⩥ An audit strategy can take ________. Answer: a reliance on controls
approach, a substantive approach, or a combination of both
⩥ An audit strategy is developed ________. Answer: in response to the
risk assessment for each significant account and assertion using the
formula for audit risk
⩥ An auditor asking the employee who prepares the bank reconciliation
how reconciling items are identified would be an example of ________.
Answer: inquiry
⩥ An auditor is attempting to determine the best sampling method for
the audit population of a major client's accounts receivable. The auditor
ELABORATED 2025 EXAM A+ GRADED 100
PERCENT VERIFIED QUESTIONS AND
ANSWERS LATEST TEST BANK COLLECTION
2026 COMPLETE SOLUTIONS GRADED A+
⩥ ________ are internal controls that are performed by individuals but
rely on computer generated information. Answer: IT dependent manual
controls
⩥ A bill of lading is a (an) ________. Answer: shipping document
serving as acknowledgement of receipt of goods for delivery by a freight
carrier
⩥ A common software-based audit technique involves ________.
Answer: submitting certain test data into the client's software application
while the auditor is in control of the software
⩥ A control ensuring that sales are recorded in the sales ledger is a/an
________-level control. Answer: transaction
⩥ A dual-purpose test ________. Answer: involves the auditors
designing a test of controls and a substantive test of details to be
performed at the same time on the same transaction
,⩥ A fundamental premise of any external audit is checking assertions
and searching for evidence to either corroborate or refute these
assertions. Which of the following statements best describes the idea of
an assertion and who holds responsibility for the assertions made?
Answer: Assertions are made by the client's management, and are
implicit within the financial statements. Management holds ultimate
responsibility for the accuracy of these assertions.
⩥ A misstatement could occur with ________. Answer: All of the
choices are correct. (a classification; an account balance; a transaction)
⩥ A misstatement is defined as ________. Answer: a difference between
what is reported in the client prepared financial statements with what is
required for the item to be presented fairly in accordance with the
applicable financial reporting framework
⩥ A notable item is an item identified from the population being
analyzed that has one or more characteristics that, for a relevant
assertion, may I. Be indicative of a risk of an immaterial misstatement
not previously identified. II. Be indicative of a risk of higher risk of
material misstatement than anticipated by the auditor. III. Provide
information useful in designing or tailoring procedures to address risks
of material misstatement. Which items are correct? Answer: II and III
,⩥ A number of substantive tests of details involve ________. Answer:
matching information in the accounting records with information on
underlying documents
⩥ A reliance on controls strategy would involve ________. Answer: the
auditor performing primarily tests of controls
⩥ Accounting estimates, by their nature ________. Answer: involve
subjective decision making on the part of management
⩥ After an initial meeting with the client's senior management, an
auditor assigned to the audit of Bookbinder LLC is attempting to
understand the entity-level controls enacted by the organization. Which
of the following would represent the most appropriate way for the
auditor to achieve this understanding? Answer: The auditor should
consider reviewing company policies and procedures as well as minutes
of board of director meetings.
⩥ After auditors have assessed control risk ________. Answer: they are
in a good position to evaluate the risk of fraud
⩥ After auditors have completed testing controls and drawn a conclusion
about control risk, they ________. Answer: make decisions about the
nature, timing, and extent of substantive testing
, ⩥ After the auditor completes test of controls and draws conclusion
about control risk, the auditor makes decisions about the nature, timing,
and extent of ________. Answer: substantive testing
⩥ After the auditor has completed test of controls and drawn a
conclusion about control risk, ________. Answer: the auditor will want
to make decisions about the nature, timing and extent of substantive
testing
⩥ All substantive audit procedures performed ________. Answer: are
documented in the working papers
⩥ An audit strategy can take ________. Answer: a reliance on controls
approach, a substantive approach, or a combination of both
⩥ An audit strategy is developed ________. Answer: in response to the
risk assessment for each significant account and assertion using the
formula for audit risk
⩥ An auditor asking the employee who prepares the bank reconciliation
how reconciling items are identified would be an example of ________.
Answer: inquiry
⩥ An auditor is attempting to determine the best sampling method for
the audit population of a major client's accounts receivable. The auditor
