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AAA1-Chapter 6

Authored by Trang Hoàng

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AAA1-Chapter 6
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12 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following controls of a sales system ensure that all goods despatched are completely and accurately invoiced

Good despatched notes are matched to sales invoices

Sales invoices are sequentially numbered

Sales invoices are matched to customer orders

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following procedures are TESTS OF CONTROL an auditor should perform in testing the inventory cycle of their client whilst attending the inventory count?

(1) Observe whether the client’s staff are following the inventory count instructions

(2) Review inventory present in the warehouse for evidence of damage or obsolescence

(3) Obtain a sample of the last goods received notes and goods despatched notes and follow through to ensure inclusion in the correct accounting period

(4) Inspect and review management’s inventory count instructions

2 and 3

1 and 4

1 and 2

3 and 4

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

One of the control objectives of the sales system of B Co is to ensure that goods and services are sold to credit-worthy customers. Which of the following control activities would assist B Co in achieving this objective? 

All sales orders are based on authorised price lists

Credit limits are checked before sales orders are accepted.

Overdue debts are chased each month by the credit controller

The aged-debt listing is reviewed by the finance director on a monthly basis

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

1.       Which of the following controls helps to ensure that payroll payments are only made to bona fide employees?

1) Personnel records maintained for all employees

 (2) Comparison of bank transfer listing with payroll

(3) Segregation of duties between staff involved in human resources and payroll functions

(4) Reperformance of the calculation of a sample of payroll deductions

(1) and (2) 

(1) and (3) 

(2) and (4) 

(3) and (4)

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

1.       B Co maintains perpetual inventory records.  Which of the following control activities would contribute to the auditor's confidence that inventory recorded in the financial statements exists?

(1) Procedures to identify obsolete and damaged inventory

(2) Physical safeguards to protect inventory from theft

(3) Sequential numbering of goods dispatched notes

 (4) Reconciliation of inventory records to results of inventory counts

(1) and (2) 

(1) and (3) 

(2) and (3) 

(2) and (4)

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

1.       Which of the following is not a test of control?

Inspection of purchase order documentation to confirm that it has been authorised 

Review of monthly bank reconciliations performed by the audit client 

Examination of purchase invoices for evidence of mathematical accuracy checks 

Agreement of the cost of non-current asset additions to purchase documentation

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

1.       Which  of  the  following  substantive  procedures  provides  evidence  over  the  EXISTENCE  of  non-current assets?

Select  a  sample  of  assets  included  in  the  non-current  asset  register  and  physically  verify  them  at  the  client premises

Review the repairs and maintenance expense account to identify any items of a capital nature

For assets disposed of, agree the sale proceeds to supporting documentation and cash book

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