L22 Notes_Part_24 - 2. If B/S END and B/S BEG are accurate...

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© W.R. Knechel Accounting for Sales Revenue The revenue principle requires that revenues be recorded when: The Earning Process is substantially complete . The amount is measurable. Cash Collection is reasonably assured. Magazines Winery FOB
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© W.R. Knechel Why audit the B/S rather than the I/S? Why focus on balance sheet account A/R instead of Sales? 1. Few B/S accounts; numerous expense account
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Unformatted text preview: 2. If B/S END and B/S BEG are accurate => NI is correct. 3. Will next year's B/S be correct? 4. Overstatements of Sales will show up in AR. 5. Easier to audit, fewer transactions in ending balance A/R valuation problem, confirmations, proof of cash, interbank transfer, lapping, kiting, revenue cycle system...
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This note was uploaded on 10/05/2011 for the course ACG 5637 taught by Professor Monikacaushoulli during the Fall '08 term at University of Florida.

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L22 Notes_Part_24 - 2. If B/S END and B/S BEG are accurate...

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