UGRD-ACTG412 APPLIED AUDITING

Shown below is the bank reconciliation for Marikina Company for November 2018:

Based on the above and the result of your audit, how much is the cash balance per books
on December 31, 2018? P180,400
Based on the above and the result of your audit, h ow much is the cash balance per bank
on December 31, 2018? P164,000
Based on the above and the result of your audit, the adjusted cash in bank balance as of
December 31, 2018 is P172,000
Based on the above and the result of your audit, how much is the December receipts per
books? P124,000
Based on the above and the result of your audit, how much is the December disbursements
per books? P79,600

The accountant for the Muntinlupa Company assembled the following data:
Based on the application of the necessary audit procedures and appreciation of the above
data, how much is the adjusted cash balance as of July 31? P120,585
Based on the application of the necessary audit procedures and appreciation of the above
data, how much is the cash shortage as of July 31? P0
Based on the application of the necessary audit procedures and appreciation of the above
data, how much is the adjusted bank receipts for July? P245,537
Based on the application of the necessary audit procedures and appreciation of the above
data, how much is the adjusted cash balance as of June 30? P87,565
Based on the application of the necessary audit procedures and appreciation of the above
data, how much is the adjusted book disbursements for July? P212,517

Which of the following generally provides the least evidence regarding the valuation of
accounts receivable?
confirming current (0-30 day) year-end accounts receivable
The overall objective in the audit of the sales and collection cycle is to evaluate whether
the account balances affected by the cycle are fairly presented in accordance with GAAP.
To obtain the best evidence regarding the completeness of recorded accounts receivable,
the auditors
trace a sample of bills of lading to sales invoices
You were able to gather the following from the December 31, 2018 trial balance of
Mandaluyong Corporation in connection with your audit of the company:
Based on the above and the result of your audit, determine the adjusted balance of cash
and cash equivalents. P3,074,900, P3,052,000
Based on the above and the result of your audit, determine the adjusted balance of cash on
hand. P440,000
Based on the above and the result of your audit, determine the adjusted balance of petty
cash fund. P6,000
Based on the above and the result of your audit, determine the adjusted balance of BPI
Current Account. P1,120,000

In the audit of Pasig Company’s cash account, you obtained the following
information:
Based on the above and the result of your audit, determine the u nadjusted cash balance
per books as of December 31, 2018? P152,800
Based on the above and the result of your audit, determine the adjusted bank disbursement
for December 2018. P 98,150
Based on the above and the result of your audit, determine the adjusted cash balance as of
December 31, 2018. P137,650
Based on the above and the result of your audit, determine the adjusted book receipts for
December 2018. P172,000
Based on the above and the result of your audit, determine the adjusted cash balance as of
November 30, 2018. P63,800

Cutoff tests designed to detect credit sales made before the end of the year that have been
recorded in the subsequent year provide assurance about management's assertion of
completeness
From the standpoint of good internal control, the credit manager should be responsible to
the treasurer
The internal control objectives of the revenue cycle include all of the following except
appropriate goods are ordered so that sales can be made.
Which of the following is not normally considered a step in the credit sales functions?
acquiring goods to fill the order
Which procedure would be of most assistance to an auditor discovering a large credit sale
that has erroneously been recorded twice? sending accounts receivable confirmations
The primary assertion being addressed by sending bank confirmation is existence

The cash account of the Makati Corporation as of December 31, 2018 consists of the
following:
At what amount will the account “Cash” appear on the December 31, 2018 balance sheet?
P1,425,000

A client might overstate December 31 accounts receivable balances by dating and recording
January transactions in December. Such entries recorded in which journal are most likely to
achieve this end? Sales
Which of the following is not typically included in the sales and collection cycle?
cash credits from the cash disbursement journal
Defective merchandise returned by customers should be presented to
receiving personnel
Matching the suppliers' invoice, the purchase order , and the receiving report normally
should be the responsibility of the accounting function
The books of Manila's Service, Inc. disclosed a cash balance of P687,570 on December
31, 2018. The bank statement as of December 31 showed a balance of P547,800.
Additional information that might be useful in reconciling the two balances follows:
Based on the above and the result of your audit, determine the adjusted cash in bank
balance. P589,200
Based on the above and the result of your audit, determine the net adjustment to cash as of
December 31, 2018. P 98,370
In connection with your audit of Caloocan Corporation for the year ended December
31, 2018, you gathered the following:
Based on the above information and the result of your audit, compute for the cash and cash
equivalent that would be reported on the December 31, 2018 balance sheet. P2,784,000
To achieve good internal control, which department should perform the activities of
matching shipping documents with sales orders and preparing daily summaries? billing
department
The use of pre-numbered invoices, then accounting for their numeric sequence, meets
primarily the existence or occurrence assertion,
rights and obligations assertion
Which of the following assertions is least likely to be addressed by sending bank
confirmation? rights and obligation, completeness
In a credit merchandising organization, the best place to vest credit approval is in accounts
receivable department , the cashier area where receipts will eventually be sent
To achieve control when there is no billing department, the billing function should be
performed by the accounting department
In the course of your audit of the Las Piñas Corporation, its controller is attempting to
determine the amount of cash to be reported on its December 31, 2018 balance sheet. The
following information is provided:
Based on the above and the result of your audit, how much will be reported as cash and
cash equivalent at December 31, 2018? P3,025,000
You noted the following composition of Malabon Company’s “cash account” as of
December 31, 2018 in connection with your audit: P2,910,000
Proof of cash or four-column bank reconciliation is normally prepared by the auditor
Before goods are shipped on account, a properly authorized person must approve credit
This document is a bank statement prepared few days after month-end. Its purpose is to
help auditors verify reconciling items on the year-end bank reconciliation. cut-off bank
statement
The internal controls surrounding the revenue cycle provide the organization with several
assurances that include all of the following except the approval of all credit sales
transactions after they are processed.
Which of the following business functions is associated with the revenue/receipt cycle?
Resources are distributed to outsiders in exchange for promises of future payments.
A reconciliation that includes proof of receipts and disbursements that is useful in
discovering possible discrepancies in handling cash over a certain period of time. bank
reconciliation, bank statement
The person who opens the mail commonly prepares a remittance advice when a customer
fails to return one with a payment. Consequently, mail should be opened by the
receptionist