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Quiz on Revenue Cycle Risks

Authored by Gatot Soepriyanto

Business

12th Grade

Used 2+ times

Quiz on Revenue Cycle Risks
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15 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is not considered a significant account in the revenue cycle?

Revenue

Accounts Receivable

Allowance for Doubtful Accounts

Cost of Goods Sold

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What assertion is typically most relevant when a client has an incentive to overstate revenue?

Completeness

Valuation

Existence

Rights and Obligations

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Inherent risks in revenue recognition include:

Side letters

Early recognition of revenue

Non-standard rights of return

All of the above

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which analytical procedure ratio is commonly used to assess revenue-related fraud risks?

Return on Assets

Receivables Turnover

Inventory Turnover

Debt-to-Equity Ratio

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following fraud risks involves fictitious revenue recognition?

Overstating receivables

Shipping goods never ordered

Recording consignment sales as final sales

All of the above

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A side letter agreement can:

Reduce the risk of fraud

Be easily identified in routine audits

Increase inherent risk by providing nonstandard terms

Eliminate the need for confirmations

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The best population to sample when testing the completeness of sales transactions is:

Customer order file

Bill of lading file

Open invoice file

Sales journal

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