Question 1 The assertion of cut-off a. ensures that events have been recorded in
ID: 2329281 • Letter: Q
Question
Question 1 The assertion of cut-off a. ensures that events have been recorded in the correct accounts. b. reflects that all assets and liabilities that should have been recorded are recorded c is an assertion made by the auditor to help determine audit testing. d. reflects that all events have been recorded in the correct accounting period. Answer: Question 2 Assertions are statements regarding the recognition, measurement, presentation, and disclosure of items included in the financial statements a. True b. False Answer: Question 3 Olga Chevalier, CPA was reviewing account balance assertions for Athabasca Oil Sands. Which one of the following would not be an account balance assertion? a. b. c. d. completeness rights and obligations accuracy, valuation, and allocation occurrence Answer:Explanation / Answer
Hello Sir/ Mam
Q - 1 - THE CORRECT ANSWER IS OPTION D.
Cut-off dates are the point of time which marks end of one period and beginning of the next and hence facilitates proper allocation of events in correct accounting period.
Hence, cut-off reflect that all events have been recorded in correct accounting period.
Q - 2 - THE CORRECT ANSWER IS TRUE.
We assume the following assertions regarding the recognition, measurement, presentation and disclosure of items included in the financial statements :
Occurance, Completeness, Accuracy, Cut-offs, Classifications, Existence, Completeness, Rights and Obligations, Valuations.
(c) THE CORRECT ANSWER IS OPTION D : Occurance
Occurance is an assertion relating to the transactions while all other are the assertion for assets and liabilities. As account balance is an asset, hence, occurance is the right answer.
(d) THE CORRECT ANSWER IS OPTION C : ACCURACY
Completeness means all transactions, balances and events are recorded, while accuracy means that all these are recorded at accurate amount.
(e) THE CORRECT ANSWER IS OPTION B : EXISTENCE
Existence is an assertion relating to Assets and Liabilities.
(f) THE CORRECT ANSWER IS OPTION A : ACCURACY, VALUATION AND ALLOCATION
Occurance and Classification are assertions for transactions and events while allowance/ provisions neither are rights nor are obligations of the entity.
I hope this solves your doubt.
Feel free to comment if you still have any query.
Do give a thumbs up if you find this helpful.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.