Question 1: Which one of the following financial ratios has a numerator and denominator whose amounts should change by approximately the percentage from year to year?
a.quick ratio.
b.current ratio.
c.accounts payable turn days.
d.payables as a percentage of total assets.
e.cost of goods sold to accounts payable
Question 2: The auditor is concerned that individuals in the purchasing department are initiating purchases on their own to companies in which they have a vested interest. The document the auditor would be most interested in reviewing under these circumstances would be the:
a.purchase order.
b.receiving report.
c.voucher.
d.purchase requisition.
e.bill of lading.
Question 3: The specific financing cycle audit objective, stockholders equity balances include the effects of all transactions pertaining to paid-in capital and retained earnings through the balance sheet date, relates to the:
a.rights and obligations assertion.
b.completeness assertion.
c.existence or occurrence assertion.
d.valuation or allocation assertion.
e.presentation or disclosure assertion.
Question 4: Analyzing ratio results relative to expectations based on prior year, budgeted, or other data relates to:
a.initial procedures.
b.analytical procedures.
c.tests of details of transactions.
d.tests of details of balances.
e.presentation and disclosure
Question 5: Organizations that manage risk well are more likely to achieve or exceed their objectives because they have the capacity and ability to do all of the following except:
a. identify and exploit opportunities.
b.identify and manage risks that could affect achieving their objectives.
c.make good decisions quickly.
d.respond and adapt to unexpected events.
e.all of the above.
Question 6: Traditional performance tracking methods focus on all of the following except:
a.sales.
b.net income.
c.needed information to anticipate the future.
d.gross margin.
e.return on assets.