Auditing & Assurance Services 7th Edition by Timothy Louwers Test bank

  Inventory is complete.  

AACSB: Analytic AICPA: BB Legal AICPA: FN Research Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 3 Hard Learning Objective: 01-03 Describe and define the assertions that management makes about the recognition; measurement; presentation; and disclosure of the financial statements and explain why auditors use them as the focal point of the audit. Source: AICPA Topic: Management's Financial Statement Assertions

 

7.	An auditor traces the serial numbers on equipment to a nonissuer's sub-ledger. Which of the following management assertions is supported by this test?      A.  Valuation and allocation.   B.  Completeness.   C.  Rights and obligations.   D.  Presentation and disclosure.

 

AACSB: Analytic AICPA: BB Legal AICPA: FN Research Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 3 Hard Learning Objective: 01-03 Describe and define the assertions that management makes about the recognition; measurement; presentation; and disclosure of the financial statements and explain why auditors use them as the focal point of the audit. Source: AICPA Topic: Management's Financial Statement Assertions

 

8.

An auditor has substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time because of negative cash flows and working capital deficiencies. Under these circumstances, the auditor would be most concerned about the      A.  control environment factors that affect the organizational structure.   B.  correlation of detection risk and inherent risk.   C.  effectiveness of the entity's internal control activities.   D.  possible effects on the entity's financial statements.