ACTIVITY ON ACCOUNTING

1. To identify whether accounts payable are complete, an

auditor performs a test to verify that all merchandise
received is recorded. The population of documents for this
test consists of all
a. Payment vouchers
b. Receiving reports
c. Purchase requisitions
d. Vendors’ invoices
2. An auditor traced a sample of purchase orders and the
related receiving reports to the purchases journal and the
cash disbursements journal. The purpose of the substantive
audit procedure was most likely to
a. Verify that cash disbursements were for goods actually
received
b. Determine those purchases were properly recorded
c. Test whether payments were for goods actually ordered
d. Identify unusually large purchases that should be
investigated earlier
3. Which of the following procedures would an auditor most
likely perform in searching for unrecorded payables?
a. Compare cash payments occurring after the end of the
reporting period with the accounts payable trial
balance.
b. Reconcile receiving reports with related cash payments
made just prior to year-end
c. Contrast the ratio of accounts payable to purchases
with the prior year’s ratio
d. Vouch a sample of creditor balances to supporting
invoices, receiving reports and purchase orders
4. When an auditor selects a sample of items from the vouchers
payable register for the last month of the period under
audit and traces these items to underlying documents, the
auditor is gathering evidence primarily in support of the
assertion that
a. Recorded obligations were paid
b. Incurred obligations were recorded in the correct
period
c. Recorded obligations were valid
d. Cash disbursements were recorded as incurred
obligations
5. In conducting a search for unrecorded liabilities, the
auditor should do all but the following:
a. Examine prior year’s audit workpapers to ascertain
those adjustments for unrecorded liabilities have not
been overlooked
b. Examine invoices paid a few days prior to the end f the
reporting period
c. Examine paid invoices for a short period following the
end of the reporting period and trace to client’s year-
end adjustment for unrecorded liabilities
d. Examine unpaid invoices for a short period following
the end of the reporting period and trace to client’s
year-end adjustment for unrecorded liabilities