Question 1

The audit objective that all balances include items owned by the client is related most closely to which one of the ASB balance assertions?

Accepted Answer

A)  Existence
B)  Rights and obligations
C)  Completeness
D)  ValuationE) None of the above
F) C) and D)

Question 2

Which of the following is not an ASB assertion about inventory related to presentation and disclosure?

Accepted Answer

A)  Inventory is properly classified as a current asset on the balance sheet.
B)  Inventory is properly stated at cost on the balance sheet.
C)  Major inventory categories and their valuation bases are adequately disclosed in notes.
D)  All of these are ASB presentation and disclosure assertions about inventory.E) A) and D)
F) All of the above

Question 3

An auditor traces the serial numbers on equipment to a nonissuer's sub-ledger.Which of the following management assertions is supported by this test?

Accepted Answer

A)  Valuation and allocation.
B)  Completeness.
C)  Rights and obligations.
D)  Presentation and disclosure.E) C) and D)
F) None of the above

Question 4

Which of the following types of audit evidence provides the least assurance of reliability?

Accepted Answer

A)  Receivable confirmations received from the client's customers.
B)  Prenumbered receiving reports completed by the client's employees.
C)  Prior months' bank statements obtained from the client.
D)  Municipal property tax bills prepared in the client's name.E) A) and C)
F) All of the above

Question 5

What type of evidence would provide the highest level of assurance in an attestation engagement?

Accepted Answer

A)  Evidence secured solely from within the entity.
B)  Evidence obtained from independent sources.
C)  Evidence obtained indirectly.
D)  Evidence obtained from multiple internal inquiries.E) C) and D)
F) B) and C)

Question 6

What are the four basic requirements for becoming a CPA?

Accepted Answer

Education,the CPA Ex...

Question 7

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?

Accepted Answer

A)  Existence
B)  Rights and obligations
C)  Completeness
D)  ValuationE) A) and B)
F) None of the above

Question 8

Because of the risk of material misstatement,an audit of financial statements in accordance with generally accepted auditing standards should be planned and performed with an attitude of

Accepted Answer

A)  objective judgment.
B)  independent integrity.
C)  professional skepticism.
D)  impartial conservatism.E) B) and C)
F) All of the above

Question 9

The confirmation of an account payable balance selected from the general ledger provides primary evidence regarding which management assertion?

Accepted Answer

A)  Completeness
B)  Valuation
C)  Allocation
D)  ExistenceE) C) and D)
F) A) and B)

Question 10

Which of the following management assertions is an auditor most likely testing if the audit objective states that all inventory on hand is reflected in the ending inventory balance?

Accepted Answer

A)  The entity has rights to the inventory.
B)  Inventory is properly valued.
C)  Inventory is properly presented in the financial statements.
D)  Inventory is complete.E) C) and D)
F) B) and C)

Question 11

According to PCAOB Auditing Standard No.2201 (AS 2201) ,the auditor should identify significant accounts and disclosures and their relevant assertions.Which of the following financial statement assertions is not explicitly identified in AS 2201?

Accepted Answer

A)  Completeness
B)  Valuation or Allocation
C)  Accuracy
D)  Existence or Occurrence
E)  All of these are assertions identified in AS 5.F) C) and D)
G) A) and B)

Question 12

The auditor's judgment concerning the overall fairness of the presentation of financial position,results of operations,and cash flows is applied within the framework of

Accepted Answer

A)  quality control.
B)  generally accepted auditing standards,which include the concept of materiality.
C)  the auditor's evaluation of the audited company's internal control.
D)  the applicable financial reporting framework (i.e.,GAAP in the United States) .E) B) and D)
F) A) and B)

Question 13

The audit objective that all transactions are recorded in the proper account is related most closely to which one of the ASB transaction assertions?

Accepted Answer

A)  Occurrence
B)  Completeness
C)  Accuracy
D)  ClassificationE) A) and B)
F) A) and C)

Question 14

An auditor selected items from the client's detailed inventory listing (that agreed to the financial statements) .During the physical inventory observation,the auditor then found each item selected and counted the number of units on hand.Assuming that the amount on hand was the same as the amount in the client's detailed inventory listing,this procedure most likely would provide evidence concerning management's assertion of

Accepted Answer

A)  completeness.
B)  valuation.
C)  presentation and disclosure.
D)  existence.
E)  rights and obligations.F) None of the above
G) B) and C)

Question 15

Inquiries of warehouse personnel concerning possible obsolete or slow moving inventory items provide assurance about the ASB balance assertion of

Accepted Answer

A)  completeness.
B)  existence.
C)  presentation.
D)  valuation.
E)  rights and obligations.F) B) and E)
G) All of the above

Question 16

The probability that the information circulated by a company will be false or misleading is referred to as

Accepted Answer

A)  business risk.
B)  information risk.
C)  assurance risk.
D)  audit risk.E) C) and D)
F) A) and C)

Question 17

The process of a CPA obtaining a certificate and license in a state other than the state in which the CPA's certificate was originally obtained is referred to as

Accepted Answer

A)  substantial equivalency.
B)  quid pro quo.
C)  relicensing.
D)  re-examination.E) None of the above
F) B) and C)

Question 18

What are the differences between the American Accounting Association and AICPA definitions and objectives of auditing?

Accepted Answer

The AAA definition is broad and general ...

Question 19

Assurance services involve all of the following,except

Accepted Answer

A)  relevance as well as the reliability of information.
B)  nonfinancial information as well as traditional financial statements.
C)  providing absolute rather than reasonable assurance.
D)  electronic databases as well as printed reports.E) A) and C)
F) None of the above

Question 20

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?

Accepted Answer

A)  Occurrence
B)  Rights and obligations
C)  Comprehensibility
D)  UnderstandabilityE) A) and B)
F) B) and D)

Exam 1: Auditing and Assurance Services

Correct Answer
verified

An auditor traces the serial numbers on equipment to a nonissuer's sub-ledger.Which of the following management assertions is supported by this test?

Correct Answer
verified

Which of the following management assertions is an auditor most likely testing if the audit objective states that all inventory on hand is reflected in the ending inventory balance?

Correct Answer
verified

The auditor's judgment concerning the overall fairness of the presentation of financial position,results of operations,and cash flows is applied within the framework of

Correct Answer
verified

Which of the following types of audit evidence provides the least assurance of reliability?

Correct Answer
verified

What are the four basic requirements for becoming a CPA?

Correct Answer
verified
Education,the CPA Ex...
View Answer

Because of the risk of material misstatement,an audit of financial statements in accordance with generally accepted auditing standards should be planned and performed with an attitude of

Correct Answer
verified

The process of a CPA obtaining a certificate and license in a state other than the state in which the CPA's certificate was originally obtained is referred to as

Correct Answer
verified

The confirmation of an account payable balance selected from the general ledger provides primary evidence regarding which management assertion?

Correct Answer
verified

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?

Correct Answer
verified

Assurance services involve all of the following,except

Correct Answer
verified

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?

Correct Answer
verified

The probability that the information circulated by a company will be false or misleading is referred to as

Correct Answer
verified

According to PCAOB Auditing Standard No.2201 (AS 2201) ,the auditor should identify significant accounts and disclosures and their relevant assertions.Which of the following financial statement assertions is not explicitly identified in AS 2201?

Correct Answer
verified

Which of the following is not an ASB assertion about inventory related to presentation and disclosure?

Correct Answer
verified

The audit objective that all transactions are recorded in the proper account is related most closely to which one of the ASB transaction assertions?

Correct Answer
verified

The audit objective that all balances include items owned by the client is related most closely to which one of the ASB balance assertions?

Correct Answer
verified

What are the differences between the American Accounting Association and AICPA definitions and objectives of auditing?

Correct Answer
verified
The AAA definition is broad and general ...
View Answer

What type of evidence would provide the highest level of assurance in an attestation engagement?

Correct Answer
verified

Inquiries of warehouse personnel concerning possible obsolete or slow moving inventory items provide assurance about the ASB balance assertion of

Correct Answer
verified

Exam 1: Auditing and Assurance Services

Correct AnswerverifiedShow Answer

An auditor traces the serial numbers on equipment to a nonissuer's sub-ledger.Which of the following management assertions is supported by this test?

Correct AnswerverifiedShow Answer

Which of the following management assertions is an auditor most likely testing if the audit objective states that all inventory on hand is reflected in the ending inventory balance?

Correct AnswerverifiedShow Answer

The auditor's judgment concerning the overall fairness of the presentation of financial position,results of operations,and cash flows is applied within the framework of

Correct AnswerverifiedShow Answer

Which of the following types of audit evidence provides the least assurance of reliability?

Correct AnswerverifiedShow Answer

What are the four basic requirements for becoming a CPA?

Correct AnswerverifiedEducation,the CPA Ex...View AnswerShow Answer

Because of the risk of material misstatement,an audit of financial statements in accordance with generally accepted auditing standards should be planned and performed with an attitude of

Correct AnswerverifiedShow Answer

The process of a CPA obtaining a certificate and license in a state other than the state in which the CPA's certificate was originally obtained is referred to as

Correct AnswerverifiedShow Answer

The confirmation of an account payable balance selected from the general ledger provides primary evidence regarding which management assertion?

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Assurance services involve all of the following,except

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

The probability that the information circulated by a company will be false or misleading is referred to as

Correct AnswerverifiedShow Answer

According to PCAOB Auditing Standard No.2201 (AS 2201) ,the auditor should identify significant accounts and disclosures and their relevant assertions.Which of the following financial statement assertions is not explicitly identified in AS 2201?

Correct AnswerverifiedShow Answer

Which of the following is not an ASB assertion about inventory related to presentation and disclosure?

Correct AnswerverifiedShow Answer

The audit objective that all transactions are recorded in the proper account is related most closely to which one of the ASB transaction assertions?

Correct AnswerverifiedShow Answer

The audit objective that all balances include items owned by the client is related most closely to which one of the ASB balance assertions?

Correct AnswerverifiedShow Answer

What are the differences between the American Accounting Association and AICPA definitions and objectives of auditing?

Correct AnswerverifiedThe AAA definition is broad and general ...View AnswerShow Answer

What type of evidence would provide the highest level of assurance in an attestation engagement?

Correct AnswerverifiedShow Answer

Inquiries of warehouse personnel concerning possible obsolete or slow moving inventory items provide assurance about the ASB balance assertion of

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Education,the CPA Ex...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The AAA definition is broad and general ...
View Answer

Correct Answer
verified

Correct Answer
verified