chapter 1 test solutions only

chapter 1 test solutions only - Chapter 01 - Auditing and...

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Chapter 01 - Auditing and Assurance Services Chapter 01 Auditing and Assurance Services Answer Key Multiple Choice Questions 1. The audit objective that all transactions and accounts that should be presented in the financial statements are in fact included is related to which of the PCAOB assertions? C. Completeness 2. To be proficient as an auditor, a person must first be able to accomplish which of these tasks in a decision-making process? C. Recognize the financial assertions made in management's financial statements and footnotes. 3. Which of the following is an underlying condition that in part creates the demand by users for reliable information? E. All of the above. 4. Which of the following is not included in The American Accounting Association (AAA) definition of auditing? A. Potential conflict of interest. 5. What is the term used to identify the risk that the client's financial statements may be materially false and misleading? B. Information risk. 6. Which of the following is not a recommendation usually made following the completion of an operational audit? C. Attesting to the fairness of the financial statements. 7. In order to be considered as external auditors with respect to government agencies, GAO auditors must be A. Organizationally independent. 8. Which of the following is the essential purpose of the audit function? C. Determination of whether the client's financial statement assertions are fairly stated. 9. The audit objective that all the transactions and accounts presented in the financial statements represent real assets, liabilities, revenues, and expenses is related most closely to which of the PCAOB assertions? A. Existence or occurrence 1-1
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Chapter 01 - Auditing and Assurance Services 10. The audit objective that all transactions are recorded in the proper period is related most closely to which of the Audit Standards Board (ASB) transaction assertions? C. Cutoff 11. The audit objective that all transactions are recorded in the proper account is related most closely to which one of the ASB transaction assertions? D. Classification 12. The audit objective that all balances include items owned by the client is related most closely to which one of the ASB balance assertions? B. Rights and obligations 13. The audit objective that all balances include all items that should be recorded in that account is related most closely to which one of the ASB balance assertions? C. Completeness 14. The audit objective that footnotes in the financial statements should be clear and expressed such that the information is easily conveyed to the readers of the financial statements is related most closely with which of the ASB presentation and disclosure assertions?
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This note was uploaded on 02/20/2012 for the course ACCTG 471 taught by Professor Muthannette during the Fall '08 term at Penn State.

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chapter 1 test solutions only - Chapter 01 - Auditing and...

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