auditingweek3homework - MULTIPLE CHOICE QUESTIONS FROM CPA...

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MULTIPLE CHOICE QUESTIONS FROM CPA EXAMINATIONS 6-19 (Objective 6-1 ) The following questions concern the reasons auditors do audits. Choose the best response. o (2) Different interests may exist between the company preparing the statements and the persons using the statements. b. An independent audit aids in the communication of economic data because the audit o (2) lends credibility to the financial statements. c. The major reason an independent auditor gathers audit evidence is to o (1) form an opinion on the financial statements. o 6-20 (Objective 6-3 ) The following questions deal with errors and fraud. Choose the best response. a. An independent auditor has the responsibility to design the audit to provide reasonable assurance of detecting errors and fraud that might have a material effect on the financial statements. Which of the following, if material, is a fraud as defined in auditing standards? o (1) Misappropriation of an asset or groups of assets. b. What assurance does the auditor provide that errors, fraud, and direct-effect illegal acts that are material to the financial statements will be detected? Errors Fraud Direct-Effect Illegal Acts (2) Reasonable Reasonable Reasonable
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c. Which of the following statements describes why a properly designed and executed audit may not detect a material misstatement in the financial statements resulting from fraud? o (1) Audit procedures that are effective for detecting unintentional misstatements may be ineffective for an intentional misstatement that is concealed through collusion. . 6-27 (Objectives 6-6 , 6-7 ) The following are specific transaction-related audit objectives applied to the audit of cash disbursement transactions (a through f), management assertions about classes of transactions (1 through 5), and general transaction-related audit objectives (6 through 11). Specific Transaction-Related Audit Objective a. Recorded cash disbursement transactions are for the amount of goods or services received and are correctly recorded. 3. Accuracy 8. Accuracy b. Cash disbursement transactions are properly included in the accounts payable master file and are correctly summarized. 3. Accuracy 9. Posting and summarization c. Recorded cash disbursements are for goods and services actually received. 1. Occurrence 6. Occurrence d. Cash disbursement transactions are properly classified. 4. Classification
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auditingweek3homework - MULTIPLE CHOICE QUESTIONS FROM CPA...

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