Questions from Auditing and Assurance

Q: In the audit of Potomac Mills, the auditors wish to test

In the audit of Potomac Mills, the auditors wish to test the costs assigned to manufactured goods. During the year, the company has produced 2,000 production lots with a total recorded cost of $5.9 mi...

Q: To test the pricing and mathematical accuracy of sales invoices, the

To test the pricing and mathematical accuracy of sales invoices, the auditors selected a sample of 200 sales invoices from a total of 41,600 invoices that were issued during the year under audit. The...

Q: The auditors of Landi Corporation wish to use a structured approach to

The auditors of Landi Corporation wish to use a structured approach to nonstatistical sampling to evaluate the reasonableness of the accounts receivable. Landi has 15,000 receivable accounts with a to...

Q: The auditors wish to test the valuation of accounts receivable in the

The auditors wish to test the valuation of accounts receivable in the audit of Kaplan Corporation. The client has $1,000,000 of total recorded receivables, composed of 2,000 accounts. The auditors hav...

Q: Following are typical questions that might appear on an internal control questionnaire

Following are typical questions that might appear on an internal control questionnaire for investments in marketable securities. 1. Is custody of investment securities maintained by an employee who do...

Q: You are the senior auditor-in-charge of the July

You are the senior auditor-in-charge of the July 31, 20X0, audit of Reliable Auto Parts, Inc. Your newly hired staff assistant reports to you that she is unable to complete the four-column roof of cas...

Q: During the audit of Sunset Building Supply, you are given the

During the audit of Sunset Building Supply, you are given the following year-end bank reconciliation prepared by the client: According to the client’s accounting records, checks t...

Q: In your audit of Ginko Company, you have received a cash

In your audit of Ginko Company, you have received a cash confirmation and a cutoff statement from the bank on Ginko’s one bank account. Prepare a list of substantive procedures for Ginko’s cash.

Q: Halston Toy Manufacturing Co. introduced a number of new products in

Halston Toy Manufacturing Co. introduced a number of new products in the last quarter of the year. The company has a liberal return policy allowing retail customers to return products within 120 days...

Q: The following are typical questions that might appear on an internal control

The following are typical questions that might appear on an internal control questionnaire for accounts receivable: 1. Are sales invoices checked for proper pricing, terms, and clerical accuracy? 2. A...