Question

After making inquiries about credit-granting policies, an auditor selects a sample of sales transactions and examines evidence of credit approval. This test of controls most likely supports management's financial statement assertion(s) of:_________.

A. both rights and obligations and valuation or allocation.
B. rights and obligations.
C. valuation or allocation.
D. neither rights and obligations nor valuation or allocation.

Answer 1

After making inquiries about credit-granting policies, an auditor selects a sample of sales transactions and examines evidence of credit approval. This test of controls most likely supports management's financial statement assertion(s) of:

C. valuation or allocation.

Step-by-step explanation:

• After making inquiries about credit-granting policies, an auditor selects a sample of sales transactions and examines evidence of credit approval. This test of controls most likely supports management's financial statement assertion(s) of:

• C. valuation or allocation.

• A complete check is a verification in which all data required to process a given type is rendered carefully
• The auditor tests an entity's policy for obtaining credit approval before the goods are shipped to the customers.