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When an auditor calculates the gross margin as a percent of sales and compares

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When an auditor calculates the gross margin as a percent of sales and compares;it with previous periods, this type of evidence is called;a. physical examination.;b. analytical procedures.;c. observation.;d. inquiry;C 6. Evidence obtained directly by the auditor will not be reliable if;a. the auditor lacks the qualifications to evaluate the evidence.;b. it is provided by the client?s attorney.;c. the client denies its veracity.;d. it is impossible for the auditor to obtain additional corroboratory evidence.;B 7. For a given audit procedure, the evidence obtained from a sample of 200 would;ordinarily be;a. more sufficient than from a sample of one hundred.;b. less sufficient than from a sample of one hundred.;c. more competent than from a sample of one hundred.;d. less competent than from a sample of one hundred.;D 8.Auditors routinely examine selected items from a much larger population.;Which of the following methods might an auditor use in selecting the items to;examine?;a. Select the items that are largest.;b. Select items randomly.;c. Select items that are most likely to contain misstatements.;d. All of the above are appropriate methods.;A 9. Which of the following statements regarding the relevance of evidence is;correct?;a. To be relevant, evidence must pertain to the question at hand.;b. To be relevant, evidence must be persuasive.;c. To be relevant, evidence must relate to multiple audit objectives.;d. To be relevant, evidence must be evaluated in terms of the general audit;objectives.;C 10.Three common types of confirmations used by auditors are (1) negative;confirmations, (2) positive confirmations with a request for information, (3);positive confirmations with the information included. If they were placed in the;order of their competence, from highest to lowest, the sequence would be;a. 1, 2, 3.;b. 3, 2, 1.;c. 2, 3, 1.;d. 3, 1, 2.;C 11.When the auditor examines the client?s documents and records to substantiate;the information on the financial statements, it is commonly referred to as;a. inquiry.;b. confirmation.;c. vouching.;d. physical examination.;B 12. An example of external documents is;a. employees? time reports.;b. bank statements.;c. purchase order for company purchases.;d. carbon copies of checks.

 

Paper#26499 | Written in 18-Jul-2015

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