AC 413 EXAM 2 QUESTIONS AND
ANSWERS (LATEST) WITH COMPLETE
SOLUTION 2026-2027 ALREADY GRADED
A+
An internal auditor has set an engagement objective of ascertaining
the reasonableness of the increases in rental revenue resulting from
operating costs passed on to the lessee by the landlord. The internal
auditor has already inspected the lease contract to determine that
such costs are allowed. Which of the following engagement
procedures will best meet this objective? - ANSWERS-Analytical
review
An internal auditor traces copies of sales invoices to shipping
documents to determine that - ANSWERS-Sales that are billed were
also shipped
Bank management suspects that a bank loan officer frequently made
loans to fictitious entities, disbursed loan proceeds to personally
established accounts, and then let the loans go into default. Some
pertinent facts about the loan officer include
A high standard of living, explained as the result of sound investments
and not taking vacations;
An expensive personal car obtained through business contacts;
Gasoline and repair bills submitted for a car assigned by the bank that
are higher than the organization's average (mileage logs were
submitted on a quarterly basis); and
, Marked annoyance with questions from internal auditors.
The extent of loans made to fictitious borrowers by the loan officer is
least likely to be discovered by - ANSWERS-Reconciliation of total
loans outstanding to the general ledger balance
An internal auditor has just completed a survey to become familiar
with the organization's payroll operations as part of an unplanned
engagement. Which of the following most likely is performed next? -
ANSWERS-Write the engagement work program
An internal auditor is testing the assertion that all claims paid by an
insurer are properly authorized and documented. Testing addresses,
among other things, whether claims are valid and consistent with
claimants' policies. The most appropriate engagement procedure is to
select a sample of - ANSWERS-Claims paid and vouch to supporting
documents
Confirmations are a highly regarded form of information. Confirmation
is most effective in addressing the existence assertion for the -
ANSWERS-Inventory held on consignment
An engagement objective is to verify that the correct goods or
services are received on time, at the right price, and in the right
quantity. Based on this objective, the function to be reviewed is the -
ANSWERS-Purchasing department
In the planning phase, the scope of an internal audit engagement is
defined by the - ANSWERS-Engangment objectives
ANSWERS (LATEST) WITH COMPLETE
SOLUTION 2026-2027 ALREADY GRADED
A+
An internal auditor has set an engagement objective of ascertaining
the reasonableness of the increases in rental revenue resulting from
operating costs passed on to the lessee by the landlord. The internal
auditor has already inspected the lease contract to determine that
such costs are allowed. Which of the following engagement
procedures will best meet this objective? - ANSWERS-Analytical
review
An internal auditor traces copies of sales invoices to shipping
documents to determine that - ANSWERS-Sales that are billed were
also shipped
Bank management suspects that a bank loan officer frequently made
loans to fictitious entities, disbursed loan proceeds to personally
established accounts, and then let the loans go into default. Some
pertinent facts about the loan officer include
A high standard of living, explained as the result of sound investments
and not taking vacations;
An expensive personal car obtained through business contacts;
Gasoline and repair bills submitted for a car assigned by the bank that
are higher than the organization's average (mileage logs were
submitted on a quarterly basis); and
, Marked annoyance with questions from internal auditors.
The extent of loans made to fictitious borrowers by the loan officer is
least likely to be discovered by - ANSWERS-Reconciliation of total
loans outstanding to the general ledger balance
An internal auditor has just completed a survey to become familiar
with the organization's payroll operations as part of an unplanned
engagement. Which of the following most likely is performed next? -
ANSWERS-Write the engagement work program
An internal auditor is testing the assertion that all claims paid by an
insurer are properly authorized and documented. Testing addresses,
among other things, whether claims are valid and consistent with
claimants' policies. The most appropriate engagement procedure is to
select a sample of - ANSWERS-Claims paid and vouch to supporting
documents
Confirmations are a highly regarded form of information. Confirmation
is most effective in addressing the existence assertion for the -
ANSWERS-Inventory held on consignment
An engagement objective is to verify that the correct goods or
services are received on time, at the right price, and in the right
quantity. Based on this objective, the function to be reviewed is the -
ANSWERS-Purchasing department
In the planning phase, the scope of an internal audit engagement is
defined by the - ANSWERS-Engangment objectives
