Certified Public Accountant Test 
CPA MULTIPLE CHOICE QUESTIONS -- Testing
1. An auditor confirms a representative number of A/R and investigates respondents exceptions and comments. By this procedure the auditor would be most likely to learn which of the following?
a) One of the cashiers has been engaged in lapping.
b) One of the sales clerks has not been preparing charge slips for credit sales to family and friends.
c) The EDP control clerk has been removing all sales invoices applicable to his account from the data file.
d) The credit manager has misappropriated remittances from customers whose accounts have been written-off.
2. Customers having substantial year-end past due balances fail to reply after second request forms have been mailed directly to them. Which of the following is the most appropriate audit procedure?
a) Examine shipping documents.
b) Review collections during the year being examined.
c) Intensify the study of the client's internal control system with respect to receivables.
d) Increase the balance in the accounts receivable allowance (contra) account.
3. To determine that sales transactions have been recorded in the proper accounting period, the auditor performs a cut-off review. Which of the following best describes the overall approach used when performing a cut-off review?
a) Ascertain that management has included in the representation letter a statement that transactions have been accounted for in the proper accounting period.
b) Confirm year-end transactions with regular customers.
c) Examine cash receipts in the subsequent period.
d) Analyze transactions occurring within a few days before and after year-end.
4. The confirmation of the client's trade accounts receivable is a means of obtaining evidential matter and is specifically considered to be generally accepted auditing
a) Principle.
c) Procedure.
b) Standard.
d) Practice.
5. Approximately 95% of returned accounts receivable confirmations indicated that the customer
1. An auditor confirms a representative number of A/R and investigates respondents exceptions and comments. By this procedure the auditor would be most likely to learn which of the following?
a) One of the cashiers has been engaged in lapping.
b) One of the sales clerks has not been preparing charge slips for credit sales to family and friends.
c) The EDP control clerk has been removing all sales invoices applicable to his account from the data file.
d) The credit manager has misappropriated remittances from customers whose accounts have been written-off.
2. Customers having substantial year-end past due balances fail to reply after second request forms have been mailed directly to them. Which of the following is the most appropriate audit procedure?
a) Examine shipping documents.
b) Review collections during the year being examined.
c) Intensify the study of the client's internal control system with respect to receivables.
d) Increase the balance in the accounts receivable allowance (contra) account.
3. To determine that sales transactions have been recorded in the proper accounting period, the auditor performs a cut-off review. Which of the following best describes the overall approach used when performing a cut-off review?
a) Ascertain that management has included in the representation letter a statement that transactions have been accounted for in the proper accounting period.
b) Confirm year-end transactions with regular customers.
c) Examine cash receipts in the subsequent period.
d) Analyze transactions occurring within a few days before and after year-end.
4. The confirmation of the client's trade accounts receivable is a means of obtaining evidential matter and is specifically considered to be generally accepted auditing
a) Principle.
c) Procedure.
b) Standard.
d) Practice.
5. Approximately 95% of returned accounts receivable confirmations indicated that the customer