Design test of controls, substantive test of Sales and Collection Cycle. Please provide a minimum of five tests of controls and tests of transactions for EACH cycle & at LEAST 3 analytical procedures as well for Sales and Collection Cycle For Apollo Shoes.© BrainMass Inc. brainmass.com December 15, 2020, 11:33 pm ad1c9bdddf
The response addresses the query posted in 708 words with APA references
//The section deals with the various test of controls and test of transactions used for checking the internal controls in the Sales and Collection Cycle and the Purchasing and Expenditure Cycle of Apollo Shoes. It also lists three analytical procedures for the Sales and Collection Cycle of Apollo Shoes.//
Test of Controls for Sales and Collection Cycle:
There are four kinds of test of controls that can be performed for checking the effectiveness of internal control system:
1) Enquiry and Confirmation:
The auditor should make an enquiry about the following points with the management:
a) The net sales of the company have increased from $236,299 in 2005 to $240,575 in 2006, while the gross profit has decreased from $115,419 to $99,006 (Louwers, & Reynolds, 2007). Therefore, inquiry should be made for the decrease in the gross profit, in spite of an increase in the figure of sales
b) There should be a letter sent to all the debtors for the confirmation of their balances. The mechanism used for checking the overdue balances should be evaluated.
c) The average collection period of debtors has increased from 4 ...
Test of controls sales and collection cycle are examined. The response addresses the query posted in 708 words with APA references