PRINCIPLES OF AUDITING EXAM 2 PRACTICE
TEST 2026 FULL SOLUTIONS REVIEW PACK
◉ Because the entity's personnel might have incentives to record
fictitious transactions, the __________ assertion is relevant for revenue
transactions.
Answer: occurrence or validity
◉ True or false: The auditor is concerned with the completeness
assertion because failure of this assertion always leads to an
overstatement of income.
Answer: False
◉ Failure to meet the _________ assertion results in an
understatement in the related account, while failure to meet the
___________ assertion results in an overstatement in the account..
Answer: completeness; occurrence
◉ The ____________ assertion relates to whether all transactions have
been properly approved..
Answer: authorization
,◉ When audit evidence supports _______________ ______________, the
auditor can issue an unqualified report..
Answer: management's assertions
◉ Whether amounts and other data relating to recorded
transactions and events have been recorded appropriately is
addressed by the ______ assertions.
o authorization
o accuracy
o occurrence
o cutoff.
Answer: o accuracy
◉ The ______ assertion relates to whether all recorded transactions
and events have happened and pertain to the entity.
o occurrence
o accuracy
o completeness
o authorization.
Answer: o occurrence
, ◉ Whether all transactions and events that occurred during the
period have been recorded relates to the ___________ assertion..
Answer: completeness
◉ True or false: The auditor's concern with the completeness
assertions is the same as the concern for occurrence..
Answer: False
It's the opposite
◉ An auditor examines shipping documents to ensure that no prior
period sales have been recorded in the current year to test the
____________ assertion..
Answer: cutoff
◉ Auditing standards use the word ______ to reflect that transactions
and events have been recorded correctly and properly authorized.
o accuracy
o occurrence
o completeness
o classification.
Answer: o accuracy
TEST 2026 FULL SOLUTIONS REVIEW PACK
◉ Because the entity's personnel might have incentives to record
fictitious transactions, the __________ assertion is relevant for revenue
transactions.
Answer: occurrence or validity
◉ True or false: The auditor is concerned with the completeness
assertion because failure of this assertion always leads to an
overstatement of income.
Answer: False
◉ Failure to meet the _________ assertion results in an
understatement in the related account, while failure to meet the
___________ assertion results in an overstatement in the account..
Answer: completeness; occurrence
◉ The ____________ assertion relates to whether all transactions have
been properly approved..
Answer: authorization
,◉ When audit evidence supports _______________ ______________, the
auditor can issue an unqualified report..
Answer: management's assertions
◉ Whether amounts and other data relating to recorded
transactions and events have been recorded appropriately is
addressed by the ______ assertions.
o authorization
o accuracy
o occurrence
o cutoff.
Answer: o accuracy
◉ The ______ assertion relates to whether all recorded transactions
and events have happened and pertain to the entity.
o occurrence
o accuracy
o completeness
o authorization.
Answer: o occurrence
, ◉ Whether all transactions and events that occurred during the
period have been recorded relates to the ___________ assertion..
Answer: completeness
◉ True or false: The auditor's concern with the completeness
assertions is the same as the concern for occurrence..
Answer: False
It's the opposite
◉ An auditor examines shipping documents to ensure that no prior
period sales have been recorded in the current year to test the
____________ assertion..
Answer: cutoff
◉ Auditing standards use the word ______ to reflect that transactions
and events have been recorded correctly and properly authorized.
o accuracy
o occurrence
o completeness
o classification.
Answer: o accuracy
