Audit Procedures for the Revenue and collection cycle
Not what you're looking for?
What account balances are included in a revenue and collection cycle? What specific control procedures should be in place and operating in internal control governing revenue recognition and cash accounting? What assertions are made about classes of transactions and events in the revenue and collection cycle?
Purchase this Solution
Solution Summary
The cited solution provides a good list of the various accounts affected in the revenue cycle. The second part explains the objectives of internal control and then reviews the revenue recognition principles. Last, the audit assertions for the revenue cycle are listed.
Solution Preview
What account balances are included in a revenue and collection cycle?
Sales, sales discounts, sales returns and allowances, accounts receivable, allowance for doubtful accounts, bad debts and, of course, cash. The revenue cycle doesn't concern itself with the purchase or production of goods, but starts with a sale.
What specific control procedures should be in place and operating in internal control governing revenue recognition and cash accounting?
The objectives of a system of internal controls over the revenue cycle include
1. All recorded transactions have occurred.
2. All of the transactions that took place are recorded.
3. The transactions have been recorded accurately.
4. The transactions have been recorded in the correct accounting period
5. The transactions have been recorded in the proper accounts.
Auditing ...
Purchase this Solution
Free BrainMass Quizzes
Learning Lean
This quiz will help you understand the basic concepts of Lean.
Paradigms and Frameworks of Management Research
This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.
Change and Resistance within Organizations
This quiz intended to help students understand change and resistance in organizations
Writing Business Plans
This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.