LSU ACCT 3222 WILEY TEST 1 2026
EXAMINATION TEST PAPER 164
QUESTIONS WITH COMPLETE SOLUTIONS
CERTIFICATION PREP MATERIAL GRADED
A+
⩥ Which of the following controls is most likely to help ensure that all
credit revenue transactions of an entity are recorded?
Answer: The billing department supervisor matches prenumbered
shipping documents with entries in the sales journal.
⩥ Which of the following controls is most likely to help ensure that all
credit revenue transactions of an entity are recorded?
Answer: Segregation of duties between receiving cash and posting the
accounts receivable ledger.
⩥ Smith Corporation has numerous customers. A customer file is
maintained and includes a customer record with a name, an address, a
credit limit, and an account balance. The auditor wishes to test this file
to determine whether credit limits are being exceeded. The best
procedure for the auditor to follow would be to
Answer: Develop a program to compare credit limits with account
balances and print out the details of any account with a balance
exceeding the credit limit.
, ⩥ Cash receipts from sales on account have been misappropriated.
Which of the following acts would conceal this defalcation and be least
likely to be detected by an auditor?
Answer: Understating the sales journal
⩥ If accounts receivable turnover (credit sales/receivables) was 7.1
times last year compared to only 5.6 times in the current year, it is
possible that there were
Answer: Fictitious sales in the current year.
⩥ If the number of days' sales in accounts receivable (365
days/receivables turnover) decreases significantly, which of the
following assertions for accounts receivable most likely is violated?
Answer: Completeness
⩥ Which of the following is most likely to be detected by an auditor's
review of an entity's sales cutoff?
Answer: Unrecorded sales for the year
⩥ Negative confirmation of accounts receivable is less effective than
positive confirmation of accounts receivable because
Answer: The auditor cannot infer that all nonrespondents have verified
their account information.
EXAMINATION TEST PAPER 164
QUESTIONS WITH COMPLETE SOLUTIONS
CERTIFICATION PREP MATERIAL GRADED
A+
⩥ Which of the following controls is most likely to help ensure that all
credit revenue transactions of an entity are recorded?
Answer: The billing department supervisor matches prenumbered
shipping documents with entries in the sales journal.
⩥ Which of the following controls is most likely to help ensure that all
credit revenue transactions of an entity are recorded?
Answer: Segregation of duties between receiving cash and posting the
accounts receivable ledger.
⩥ Smith Corporation has numerous customers. A customer file is
maintained and includes a customer record with a name, an address, a
credit limit, and an account balance. The auditor wishes to test this file
to determine whether credit limits are being exceeded. The best
procedure for the auditor to follow would be to
Answer: Develop a program to compare credit limits with account
balances and print out the details of any account with a balance
exceeding the credit limit.
, ⩥ Cash receipts from sales on account have been misappropriated.
Which of the following acts would conceal this defalcation and be least
likely to be detected by an auditor?
Answer: Understating the sales journal
⩥ If accounts receivable turnover (credit sales/receivables) was 7.1
times last year compared to only 5.6 times in the current year, it is
possible that there were
Answer: Fictitious sales in the current year.
⩥ If the number of days' sales in accounts receivable (365
days/receivables turnover) decreases significantly, which of the
following assertions for accounts receivable most likely is violated?
Answer: Completeness
⩥ Which of the following is most likely to be detected by an auditor's
review of an entity's sales cutoff?
Answer: Unrecorded sales for the year
⩥ Negative confirmation of accounts receivable is less effective than
positive confirmation of accounts receivable because
Answer: The auditor cannot infer that all nonrespondents have verified
their account information.
