Nama : ……………………………..

NIM : ……………………………..

QUIZ 1 AUDITING 2
Hari/Tanggal: 27 April 2023
Waktu : 100 menit
Sifat Quiz : Individual, Close Book, No Gadget

1) You are performing an audit of Prasmul Company. In evaluating the accounts payable
balance you are concerned with the completeness assertion. Which of the following audit
procedures best satisfy your concern?
A) Send confirmations to only vendors with large balances.
B) Send confirmations to vendors with large, active, zero balance accounts and a
representative sample of all others.
C) Send confirmations to vendors chosen from sample stratified by the dollar balance.
D) Send confirmations to all vendors.

2) The main difference between job order and process costing systems is that
A) one accumulates costs by materials issued and the other by labor incurred.
B) one accumulates costs by individual jobs and the other by particular processes.
C) one emphasizes costs accumulated in completed products and the other emphasizes costs
associated with work-in-process.
D) one emphasizes costs adding value to the product and the other emphasizes costs incurred
because of waste, scrap, and obsolescence.

3) In testing acquisitions the auditor needs to understand the appropriate accounting guidance
related to acquisition accounting. Which of the following is not an accounting consideration
for the auditor as regards to acquisition cost?
A) inclusion of material transportation and installation costs
B) recording of trade-in costs
C) allocating costs when building and equipment are purchased at one price
D) verifying that purchased equipment amounts correspond to the budgeted amount

4) Which of the following would generally not need to be approved by the board of
directors?
A) issuing capital stock
B) repurchasing capital stock
C) declaration of a dividend
D) payment of a dividend

5) A document generally received from the vendor which indicates a reduction in the amount
owed due to the company granting an allowance is a
A) vendor invoice.
B) debit memo.
C) credit adjustment form.
D) credit memo.

6) Which of the following is a continuously updated computerized record of inventory items

purchased, used, sold, and on hand for merchandise, raw materials, and finished goods?
 Nama : ……………………………..
NIM : ……………………………..

A) job cost system

B) standard cost records
C) cost accounting records
D) perpetual inventory master file

7) Which of the following audit tests would provide evidence regarding the balance-related
audit objective of existence for an audit of MTN ?
A) Examine due dates on duplicate copies of notes.
B) Examine balance sheet for proper presentation and disclosure of notes payable.
C) Examine corporate minutes for loan approval.
D) Foot the notes payable list for notes payable and accrued interest.

8) When auditors examine vendors' statements or receive confirmations, there must be a

reconciliation of the statement or confirmation with the:
A) accounts payable list.
B) vendors' invoices.
C) purchase orders.
D) receiving reports.

9) Assume that the client's valuation of an inventory item is $10 per unit for 1,000 units, using
first-in, first-out (FIFO). If the most recent acquisition of inventory was for 600 units at $10
per unit and the immediately preceding acquisition was for 700 units at $9 per unit, the
inventory item is in error and it is:
A) understated $400.
B) understated $300.
C) overstated $400.
D) overstated $700.

10) An auditor traces a sample of electronic time cards before and after the bi-weekly payroll
report and then traces to the payroll master file to determine that payroll transactions are
reported in the correct period. The auditor is gathering evidence for which audit objective?
A) Completeness
B) Existence
C) Cut-off
D) Accuracy

11) What typically initiates the acquisitions and payment cycle?

A) issuance of a purchase requisition or request for purchase of goods or services
B) issuance of payment to vendor
C) approval of a new vendor
D) purchase requisition.

12) Which of the following statements regarding the capital acquisition and repayment cycle
is most correct?
A) A relatively few transactions affect the cycle, and most are smaller amounts.
B) A large numbers of transactions affect the cycle, and most are smaller amounts.
C) A relatively few transactions affect the cycle, and most are highly material.
D) A large number of transaction affect the cycle, and most are highly material.
 Nama : ……………………………..
NIM : ……………………………..

13) Auditor tests of the physical controls over raw materials, work in process, and finished
goods are generally limited to
A) observation and confirmation.
B) observation and inquiry.
C) inquiry and reconciliation.
D) observation and reconciliation.

14) A document indicating a reduction in the amount owed to a vendor because of returned
goods is
A) a debit memo.
B) a credit memo.
C) a receiving report.
D) a contractual adjustment form.

15) You are auditing the acquisition and payment cycle and note the presence of excessive
recurring losses on retired assets. You may conclude that
A) insured values are greater than book values.
B) there are a large number of fully depreciated assets.
C) depreciation charges may by insufficient.
D) the company has a policy of selling relatively new assets.

16) A major difficulty in the verification of inventory cost records for the purpose of inventory
valuation is in determining the reasonableness of the
A) direct labor costs.
B) raw material costs.
C) manufacturing overhead costs.
D) period costs.

17) Responsibility for the issuance of new notes payable would normally be vested in the
A) board of directors.
B) purchasing department.
C) accounting department.
D) accounts payable department.

18) When auditing prepaid insurance,

A) for many audits, significant substantive procedures are needed if the control risk is low.
B) companies often have a standard monthly journal entry to reclassify prepaid
insurance as insurance expense.
C) the emphasis in the tests of details of balances is on insurance expense.
D) the auditor must prepare the insurance register.

19) Receipt of ordered materials by the receiving department will generate the completion of
a form called the
A) bill of lading.
B) receiving report.
C) materials requisition.
D) inventory acquisition summary.
 Nama : ……………………………..
NIM : ……………………………..

20) Auditor confirmation of accounts payable balances at the balance sheet date may not need
to be performed by the auditor because:
A) this is a duplication of cutoff tests.
B) there is likely to be other reliable external evidence available to support the balances.
C) accounts payable balances at the balance sheet date may not be paid before the audit is
completed.
D) correspondence with the audit client's attorney will reveal all legal action by vendors for
nonpayment.

21) When auditing interest-bearing debt, the auditor should ________ verify the related interest
expense and interest payable.
A) not
B) attempt to
C) simultaneously
D) never

22) If the perpetual inventory master files show lower quantities of inventory than the physical
count, an explanation of the difference might be unrecorded
A) sales.
B) sales discounts.
C) purchases.
D) purchase discounts.

23) You are the in-charge auditor and are designing audit procedures for accounts payable.
Which of the following management assertions would you normally be most concerned
about?
A) Occurrence
B) Accuracy
C) Completeness
D) Existence

24) It is frequently possible to test the physical inventory prior to the balance sheet date when
A) the perpetual inventory records are accurate and related controls operate effectively.
B) year-end sales are small.
C) the internal control system is no better at year-end than at an earlier point in time.
D) the client counts inventory at interim dates.

25) Insurance expense for the period is a function of which of the following?
A) The beginning prepaid balance, current premium payments and the ending prepaid
balance
B) The beginning prepaid balance and the current period premium payments
C) The current period premium payments
D) The current period premium payments and the ending prepaid balance.

26) A major source of cutoff information for sales and purchases of inventory is:
A) confirmations from outside parties.
B) the test of details of balances.
C) physical observation.
D) the performance of analytical procedures.
 Nama : ……………………………..
NIM : ……………………………..

27) An auditor traces a sample of electronic time cards before and after the bi-weekly payroll
report and then traces to the payroll master file to determine that payroll transactions are
reported in the correct period. The auditor is gathering evidence for which audit objective?
A) Completeness
B) Existence
C) Cut-off
D) Accuracy

28) After a purchase requisition is approved, a ________ must be initiated to purchase the
goods or services.
A) purchase order
B) vendor order
C) call order
D) vendor invoice

29) At what point in the acquisition and payment cycle do most companies first recognize the
acquisition and related liability on their records?
A) when the purchase requisition is received by the accounting department
B) when the purchase order is prepared
C) when the company receives the invoice from the vendor
D) when the company receives the goods or services from the vendor

30) You are auditing the inventory account and are concerned about the possibility of an
inventory overstatement. What is the best audit procedure to detect damaged inventory?
A) Observe the condition of inventory during the client's physical count.
B) Compare the condition of inventory from the previous year's count to the current year.
C) Compare inventory turnover from the previous year's inventory to the current year's
inventory.
D) Reconcile the inventory counts to the cost accounting records.

31) Which is not one of the tests that would be used in the audit of equipment, depreciation
expense, and accumulated depreciation?
A) Verify the ending balance in the asset account.
B) Send confirmations to the sales personnel who sold the equipment to the company.
C) Perform substantive analytical procedures.
D) Verify current year acquisitions.

32) From which of the following evidence-gathering audit procedures would an auditor obtain
most assurance concerning the existence of inventories?
A) observation of physical inventory counts
B) written inventory representations from management
C) confirmation of inventories in a public warehouse
D) auditor's recomputation of inventory extensions

33) Insurance expense for the period is a function of which of the following?
 Nama : ……………………………..
NIM : ……………………………..

A) the beginning prepaid balance, current premium payments and the ending prepaid
balance
B) the beginning prepaid balance and the current period premium payments
C) the current period premium payments
D) the current period premium payments and the ending prepaid balance

34) To minimize the opportunity for fraud, unclaimed salary checks should be
A) redeposited.
B) kept in the payroll department.
C) left with the employee's supervisor.
D) held for the employee in the personnel department.

35) Inventory is a complex area to audit for all except which of the following reasons?
A) Inventory is often in different locations.
B) There are several acceptable valuation methods and some entities use different methods
for different types of inventory.
C) Inventory is often the largest account on the balance sheet.
D) Inventory valuation includes few estimates.

36) Which of the following statements is correct regarding the capital acquisition and payment
cycle?
A) Bonds are frequently issued by companies in small amounts.
B) There are relatively few transactions and each transaction is typically highly
material.
C) A primary emphasis in auditing debt is on existence.
D) Audit procedures for notes payable and interest income are often performed simultaneously.

37) When a physical count of inventory is performed at an interim date, the auditor observes it
at that time and tests the perpetual records for transactions
A) throughout the year.
B) which are a representative sample of the period under audit.
C) from the date of the count to year-end.
D) from the date of the count to the end of the audit field work.

38) An auditor is determining whether an issuance of notes payable for cash was correctly
recorded. Her or his best course of action would be to
A) confirm with the bond trustee as to the amount of bonds issued.
B) confirm with the underwriter as to the appropriate market yield on the bonds.
C) trace the cash received from the proceeds to the accounting records.
D) verify that the amount was included in a footnote disclosure.

39) Changing circumstances may require a change in the useful life of an asset. When this
occurs, it involves a change in
A) accounting estimate rather than a change in accounting principle.
B) accounting principle rather than a change in accounting estimate.
C) both accounting principle and accounting estimate.
D) neither accounting principle nor accounting estimate.
 Nama : ……………………………..
NIM : ……………………………..

40) The most important consideration in evaluating the fairness of the amounts accrued for
vacation pay, sick pay, and other benefits is the:
A) consistent accrual of these liabilities relative to those of preceding periods.
B) actual expense incurred for the prior period.
C) amount expended to date in the current period.
D) profitability of the client which will enable these liabilities to be met.