Question

In determining whether transactions have occurred and pertain to the entity, the direction of the audit testing should start from the:

a. general journal entries
b. purchase requisitions
c. receiving reports
d. vendor invoices

Answer 1

The direction of the audit testing should start from the general journal entries.

Step-by-step explanation:

In determining whether transactions have occurred and pertain to the entity, the direction of the audit testing should start from the:

1. general journal entries
2. purchase requisitions
3. receiving reports
4. vendor invoices

The correct answer is general journal entries. When performing an audit, starting from the general journal entries allows auditors to trace the recorded transactions to other related documents such as purchase requisitions, receiving reports, and vendor invoices.