ACCT 3222 Final Exam Set Solved 100%

ACCT 3222 Final Exam Set Solved 100% For the control activities to be effective, employees maintaining the accounts receivable subsidiary ledger should not also approve -Correct AnswerWrite-offs of customer accounts. Which of the following controls is most likely to help ensure that all credit revenue transactions of an entity are recorded? -Correct AnswerThe billing department supervisor matches prenumbered shipping documents with entries in the sales journal. Which of the following controls is most likely to help ensure that all credit revenue transactions of an entity are recorded? -Correct AnswerSegregation of duties between receiving cash and posting the accounts receivable ledger. Smith Corporation has numerous customers. A customer file is maintained and includes a customer record with a name, an address, a credit limit, and an account balance. The auditor wishes to test this file to determine whether credit limits are being exceeded. The best procedure for the auditor to follow would be to -Correct AnswerDevelop a program to compare credit limits with account balances and print out the details of any account with a balance exceeding the credit limit. Cash receipts from sales on account have been misappropriated. Which of the following acts would conceal this defalcation and be least likely to be detected by an auditor? -Correct AnswerUnderstating the sales journal If accounts receivable turnover (credit sales/receivables) was 7.1 times last year compared to only 5.6 times in the current year, it is possible that there were -Correct AnswerFictitious sales in the current year. If the number of days' sales in accounts receivable (365 days/receivables turnover) decreases significantly, which of the following assertions for accounts receivable most likely is violated? -Correct AnswerCompleteness Which of the following is most likely to be detected by an auditor's review of an entity's sales cutoff? -Correct AnswerUnrecorded sales for the year Negative confirmation of accounts receivable is less effective than positive confirmation of accounts receivable because -Correct AnswerThe auditor cannot infer that all nonrespondents have verified their account information.