Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Chapter 14, Problem 33FOQ
To determine
Identify the appropriate answer related to the effective control over the accounts payable.
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Match each document in a voucher system with its description. Document 1. Purchase requisition 2. Purchase order 3. Invoice 4. Receiving report 5. Invoice approval 6. Voucher Description A. An itemized statement of goods prepared by the vendor listing the customer’s name, items sold, sales prices, and terms of sale. B. An internal file used to store documents and information to control cash payments and to ensure that a transaction is properly authorized and recorded. C. A document used to place an order with a vendor that authorizes the vendor to ship ordered merchandise at the stated price and terms. D. A checklist of steps necessary for the approval of an invoice for recording and payment; also known as a check authorization. E. A document used by department managers to inform the purchasing department to place an order with a vendor. F. A document used to notify the appropriate persons that ordered goods have arrived, including a description of the quantities and condition of…
In a good internal control system, which of the following sets of documents is required for proper approval of a payment to a supplier?
A.
a journal entry, a supplier invoice, and a description of the goods being purchased
B.
a supplier invoice, a bill of lading, and the supplier's financial statements
C.
a purchase order, a journal entry, and a price catalog
D.
a receiving report, an invoice, and a purchase order
the purchases and disbursements cycle usually begins when
a. a user department request for acquisition of goods or services and submits purchase requisition to the purchasing department
b. a check is issued to the vendor or supplier
c. the warehouse is received the goods from the vendor or supplier
d. the accounting posts the purchase transaction in the accounts payable ledger
Chapter 14 Solutions
Principles Of Auditing & Other Assurance Services
Ch. 14 - If a corporation overstates its earnings, are its...Ch. 14 - Prob. 2RQCh. 14 - Prob. 3RQCh. 14 - Prob. 4RQCh. 14 - Prob. 5RQCh. 14 - Prob. 6RQCh. 14 - Prob. 7RQCh. 14 - Prob. 8RQCh. 14 - List the major responsibilities of an accounts...Ch. 14 - Prob. 10RQ
Ch. 14 - Prob. 11RQCh. 14 - Prob. 12RQCh. 14 - Prob. 13RQCh. 14 - Prob. 14RQCh. 14 - Prob. 15RQCh. 14 - Prob. 16RQCh. 14 - Prob. 17RQCh. 14 - Whitehall Company records its liabilities in an...Ch. 14 - Prob. 19RQCh. 14 - Prob. 20RQCh. 14 - Prob. 21RQCh. 14 - Prob. 22RQCh. 14 - What is the purpose of the auditors review of cash...Ch. 14 - Prob. 24RQCh. 14 - Prob. 25RQCh. 14 - Prob. 26RQCh. 14 - Prob. 27QRACh. 14 - Prob. 28QRACh. 14 - Prob. 29QRACh. 14 - Prob. 30QRACh. 14 - Prob. 31QRACh. 14 - Prob. 32QRACh. 14 - Which of the following procedures is least likely...Ch. 14 - Prob. 33BOQCh. 14 - Which of the following is the best audit procedure...Ch. 14 - Prob. 33DOQCh. 14 - Prob. 33EOQCh. 14 - Prob. 33FOQCh. 14 - Prob. 33GOQCh. 14 - Prob. 33HOQCh. 14 - Ordinarily, the most significant assertion...Ch. 14 - Prob. 33JOQCh. 14 - Prob. 33KOQCh. 14 - Prob. 33LOQCh. 14 - Prob. 34OQCh. 14 - Prob. 35OQCh. 14 - Prob. 36OQCh. 14 - Prob. 37OQCh. 14 - Prob. 38PCh. 14 - Prob. 39PCh. 14 - Prob. 40PCh. 14 - Prob. 41PCh. 14 - Prob. 42PCh. 14 - Prob. 43ITC
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- Each of the below describes a procedure consistent with a strong system of internal control except… Question 7 options: The customer order department determines when a sale has occurred and should be recorded. The accounts payable department agrees purchase requisitions, purchase orders, receiving reports, and invoices prior to payment. Quantities ordered are excluded from the receiving department copy of a purchase order so receiving personnel count and inspect merchandise received. The use of remittance advices for customers' payments on accounts receivable received in the mail.arrow_forwardDescribe the purpose of a purchase order by selecting the correct statement(s) below. (Check all that apply.) A purchase order is a document the purchasing department uses to place an order with a vendor. Multiple copies of the purchase order are distributed to other departments to increase internal control of company pu A purchase order authorizes a vendor to ship ordered merchandise at a stated price and terms. A purchase order is a bill received from the vendor that reflects the amount owed by the buyer.arrow_forwardDescribe the flow of data in the purchasing process that is initiated when the purchasing organization issues a check to a vendor in payment of an invoice for merchandise purchase.arrow_forward
- All of the following are true concerning an invoice except: When a shipment arrives, the receiving department counts the items received against the purchase order. The vendor ships items ordered after it receives a purchase requisition. The invoice is sent to the buyer's accounting department where it is placed in the voucher. Ⓒ When all coples are in the voucher, the accounting department can record the purchase and approve its payment.arrow_forwardThe purchases and disbursements cycle usually begins when Group of answer choices A user department requests for acquisition of goods or services and submits purchase requisition to the purchasing department. A check is issued to the vendor or supplier. The warehouse received the goods from the vendor or supplier. The accounting posts the purchase transaction in the accounts payable ledger.arrow_forwardExplain, on what criteria or by what internal controls in place, where Billing could be responsible for issuing invoices, sales journal, AR update (for both billing and payment received).arrow_forward
- Which of the following tests is directed towards the management assertion of completeness of sales? Question 19 options: 1) Checking mathematical accuracy of invoices. 2) Vouching sales recorded to invoices held. 3) Tracing delivery documents to invoices and sales recorded. 4) Vouching invoices to delivery documents. Next Pagearrow_forwardA company is trying to set up proper internal controls for their accounts payable/inventory purchasing system. Currently the purchase order is generated by the same person who receives the inventory. Together the purchase order and the receiving ticket are sent to accounts payable for payment. What changes would you make to improve the internal control structure? Group of answer choices 1.The person in accounts payable should generate the purchase order. 2.The person in accounts payable should generate the receiving ticket once the invoice from the supplier is received. 3.No changes would be made since the person paying the bills is different from the person ordering the inventory. 4.The responsibilities of generating the purchase order and receiving the inventory should be separated among two different people.arrow_forwardDescribe the data flow in the buying process that begins when the purchasing organization sends a check to a vendor to settle an invoice for goods bought.arrow_forward
- Which function should the billing department NOT perform? a. record the sales in the sales journal b. send the ledger copy of the sales order to accounts receivable c. send the stock release document and the shipping notice to the billing department as proof of shipment d. send the stock release document to inventory controlarrow_forwardWhich statement about Revenue Cycle is correct? The customer and accounts payable department gets copies of the invoice.The sales order department prepares the invoice.The billing department uses the sales order and shipping documents to create the invoice.The accounts receivable department uses the sales order to update the accounts receivable subsidiary ledgerarrow_forwardWhich of the following frames would best enable an auditor to test a sales/receivables system to determine that receivables are supported by all required documentation ? (a) Customer list (b) Sales invoice log Sales order log (d) Shipping logarrow_forward
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