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A comprehensive set of questions and answers related to chapters 12 and 13 of lsu's acct 3222 course, covering topics such as auditing payables and liabilities, cash, ppe, lt debt, and se. It offers insights into key assertions, audit procedures, and specific examples relevant to the final exam.
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What assertion is most important in auditing payables and liabilities? correct answer: completeness What assertion is tested when performing initial procedures for A/P balances? correct answer: valuation 4 initial procedures for A/P correct answer: 1. agree BB to PY
During cutoff testing for A/P, which transactions regarding shipment should the client record if they are the purchaser? What if they are the seller? correct answer: Purchaser: if FOB shipping point, anything shipped before or on YE if FOB destination, client should record anything received before or on YE Seller: if FOB shipping point, ownership transfers if shipped before/on YE if FOB destination, client still owns anything still in transit on YE 3 procedures done when performing the search for unrecorded liabilites during the test of details of transactions? correct answer: 1. inspect subsequent cash disbursements
How should the client avoid kiting with bank transactions? correct answer: book dates should be the same for both accounts at the different banks to avoid a double count 2 procedures when testing the details of balances when auditing CASH? correct answer: - confirm cash balances
record as LT investment Why is cash a low risk account? correct answer: it is kept in a 3rd party (bank) lower volume of transaction but higher in value correct answer: PPE 6 activities what occur with PPE correct answer: 1. Acquisitions