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Chap010 - Chapter 10 Finance and Investment Cycle Chapter...

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Chapter 10 - Finance and Investment Cycle Chapter 10 Finance and Investment Cycle Multiple Choice Questions 1. The typical business activity of the finance and investment cycle would not include A. Proposals for cash forecasts, capital budgets, and business expansion. B. Analyses of excess cash funds. C. Reconciliation of cash. D. Sale of stocks, bonds, or notes. 2. Selecting a sample of paid notes and tracing interest to the general ledger account is a test of the PCAOB assertion for 3. The typical assertions related to investments and related accounts would not include the PCAOB assertion that 4. The decision of a company to have a transfer agent handle exchanges of shares is related primarily to which of the functional responsibilities? 10-1
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Chapter 10 - Finance and Investment Cycle 5. ABC Company has issued a bond that pays 5% interest semi-annually to bond holders on record June 30 and December 30. Payments are made on July 15 and January 15. ABC Company has a December 31 fiscal year end. The auditor vouches the January 15, 2010 payment to the liabilities recorded on the December 31, 2009 balance sheet. Which of the following ASB balance assertions is the auditor testing? A. Existence. B. Rights and obligations. C. Completeness. D. Valuation. 6. Auditors count investment securities held by the client primarily to test the ASB balance assertion of 7. Which of the following is not a substantive audit procedure for estimates of management? 8. Which of the following would not be a place in which owners' equity transactions would be documented? 10-2
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Chapter 10 - Finance and Investment Cycle
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