Strayer ACC403 Final Exam Part 1 and 2 (A+++++ Answer) - 94515

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Part 1 Question Question 1 6 out of 6 points Auditors frequently refer to the terms audit assurance, overall assurance, and level of assurance to refer to ________. Question 2 6 out of 6 points If an auditor believes the chance of financial failure is high and there is a corresponding increase in business risk for the auditor, acceptable audit risk would likely: Question 3 6 out of 6 points If it is probable that the judgment of a reasonable person will be changed or influenced by the omission or misstatement of information, then that information is, by definition of FASB Statement No. 2: Question 4 6 out of 6 points When auditors allocate the preliminary judgment about materiality to account balances, the materiality allocated to any given account balance is referred to as: Question 5 6 out of 6 points When the auditor is attempting to determine the extent to which external users rely on a client's financial statements, they may consider several factors except for: Question 6 6 out of 6 points Internal controls can never be regarded as completely effective. Even if company personnel could design an ideal system, its effectiveness depends on the: Question 7 6 out of 6 points In performing the audit of internal control over financial reporting the auditor emphasizes internal control over class of transactions because: Question 8 6 out of 6 points When considering internal controls, an important point to consider is that: Question 9 6 out of 6 points Narratives, flowcharts, and internal control questionnaires are three common methods of: Question 10 6 out of 6 points The employee in charge of authorizing credit to the company's customers does not fully understand the concept of credit risk. This lack of knowledge would constitute: Question 11 6 out of 6 points Analytical procedures can be very effective in detecting inventory fraud. Which of the following analytical procedures would not be useful in detecting fraud? Question 12 6 out of 6 points Financial statement manipulation risk is arguably present for all companies' financial statements. However, the risk is elevated for companies that: Question 13 6 out of 6 points Which party has the primary responsibility to oversee an organization's financial reporting and internal control process? Question 14 6 out of 6 points Who is most likely to perpetrate fraudulent financial reporting? Question 15 6 out of 6 points Which of the following would the auditor be most concerned about regarding a heightened risk of intentional misstatement? Question 16 6 out of 6 points An example of a physical control is: Question 17 6 out of 6 points The audit approach in which the auditor runs his or her own program on a controlled basis to verify the client's data recorded in a machine language is: Question 18 6 out of 6 points Which of the following describes the process of implementing a new system in one part of the organization, while other locations continue to use the current system? Question 19 6 out of 6 points A ________ total represents the summary total of codes from all records in a batch that do not represent a meaningful total. Question 20 6 out of 6 points The continued integration of IT in accounting systems can impact a company by: Question 21 6 out of 6 points Which of the following audit tests is usually the least costly to perform? Question 22 6 out of 6 points The purpose of tests of controls is to provide reasonable assurance that the: Question 23 6 out of 6 points Many auditors perform extensive analytical procedures on audits because: Question 24 6 out of 6 points A system walkthrough is primarily used to help the auditor: Question 25 6 out of 6 points Analytical procedures: Part 2 Question 1 6 out of 6 points Before goods are shipped on account, a properly authorized person must: Question 2 6 out of 6 points What critical event must take place before goods can be shipped in order to assure payment can be reasonably expected? Question 3 6 out of 6 points The document that requires adjustments to the customers subsidiary ledger account is the: Question 4 6 out of 6 points A document prepared to initiate shipment of the goods sold by an independent shipper is the: Question 5 0 out of 6 points What event initiates a transaction in the sales and collection cycle? Question 6 6 out of 6 points Auditors often use the ________ to determine the estimated population exception rate. Question 7 6 out of 6 points When the auditor decides to select less than 100 percent of the population for testing, the auditor is said to use: Question 8 6 out of 6 points Rodgers CPA believes that the rate of client billing errors is 4% and has established a tolerable deviation rate of 6%. In auditing client invoices Rodgers should use: Question 9 6 out of 6 points Which of the following would have the least impact in determining sample size? Question 10 6 out of 6 points Which of the following occurrences would be least likely to warrant further audit attention for the auditor? Question 11 6 out of 6 points The most effective audit evidence gathered for accounts receivable is the: Question 12 6 out of 6 points Which of the following most likely would be detected by a review of a client's sales cutoff? Question 13 6 out of 6 points Analytical procedures: Question 14 6 out of 6 points When do most companies record sales returns and allowances? Question 15 6 out of 6 points Tests of which balance-related audit objective are normally performed first in an audit of the sales and collection? Question 16 6 out of 6 points The risk the auditor is willing to take of accepting a balance as correct when the true misstatement in the balance under audit is greater than the tolerable misstatement is: Question 17 6 out of 6 points The client's trial balance has a balance of $410,000 for merchandise inventory. As the auditor you are willing to accept a balance that is within $20,000 of either side of the recorded balance. You compute a 95% confidence interval of $395,000 to $425,000. You could therefore: Question 18 6 out of 6 points One of the steps involved in planning the sample for the tests of details of balances is to: Question 19 6 out of 6 points When the sample selection is done using probability proportional to size sample selection (PPS): Question 20 6 out of 6 points When defining the population and the sampling unit for tests of details of balances: Question 21 6 out of 6 points From which of the following evidence-gathering audit procedures would an auditor obtain most assurance concerning the existence of inventories? Question 22 6 out of 6 points Comparing the physical counts with the perpetual inventory master files satisfies the balance-related audit objective of: Question 23 6 out of 6 points Auditor tests of the physical controls over raw materials, work in process, and finished goods are generally limited to: Question 24 6 out of 6 points Boxes or other containers holding inventory should also be opened during test counts to determine the ________ of the inventory. Question 25 6 out of 6 points The audit tests to verify that the client is using an inventory method which is generally accepted and to verify that physical counts were correctly summarized are performed during the audit of the: Question 26 6 out of 6 points The auditor's primary concern relative to presentation and disclosure-related objectives is: Question 27 6 out of 6 points Which of the following subsequent events is most likely to result in an adjustment to a company's financial statements? Question 28 6 out of 6 points When communicating with the audit committee and management: Question 29 6 out of 6 points At the completion of the audit, management is asked to make a written statement that it is not aware of any undisclosed contingent liabilities. This statement would appear in the: Question 30 6 out of 6 points While there is no professional requirement to do so on audit engagements, CPAs frequently issue a formal "management" letter to clients. The primary purpose of this letter is to provide:
Solution Description

Part 1

Question

Question 1

6 out of 6 points

Auditors frequently refer to the terms audit assurance, overall assurance, and level of assurance to refer to ________.

Question 2

6 out of 6 points

If an auditor believes the chance of financial failure is high and there is a corresponding increase in business risk for the auditor, acceptable audit risk would likely:

Question 3

6 out of 6 points

If it is probable that the judgment of a reasonable person will be changed or influenced by the omission or misstatement of information, then that information is, by definition of FASB Statement No. 2:

Question 4

6 out of 6 points

When auditors allocate the preliminary judgment about materiality to account balances, the materiality allocated to any given account balance is referred to as:

Question 5

6 out of 6 points

When the auditor is attempting to determine the extent to which external users rely on a client's financial statements, they may consider several factors except

for:

Question 6

6 out of 6 points

Internal controls can never be regarded as completely effective. Even if company personnel could design an ideal system, its effectiveness depends on the:

Question 7

6 out of 6 points

In performing the audit of internal control over financial reporting the auditor emphasizes internal control over class of transactions because:

Question 8

6 out of 6 points

When considering internal controls, an important point to consider is that:

Question 9

6 out of 6 points

Narratives, flowcharts, and internal control questionnaires are three common methods of:

Question 10

6 out of 6 poin

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