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Chapter 14
Auditing Test #3
7
Accounting
Undergraduate 4
12/06/2011

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Cards

Term
business functions for the sales and collection cycle
Definition
the key activities that an organization must complete to execute and record business transactions for sales, cash receipts, sales returns and allowances, write-off of uncollectible accounts, and bad debt expense
Term
classes of transactions in the sales and collection cycle
Definition
sales, cash receipts, sales returns and allowances, write-off of uncollectible accounts, and bad debt expense
Term
design format audit program
Definition
the audit procedures resulting from the auditor's decisions about hte appropriate audit procedures for each audit objective; this is used to prepare a performance format audit program
Term
lapping of accounts receivable
Definition
the postponement of entries for the collection of receivables to conceal an existing cash shortage
Term
performance format audit program
Definition
audit procedures for a class of transactions organized in the format in which they will be performed
Term
proof of cash receipts
Definition
an audit procedure to test whether all recorded cash receipts have been deposited in the bank account by reconciling the total cash receipts recorded in the cash receipts journal for a given period with the actual deposits made to the bank
Term
sales and collection cycle
Definition
involves the decisions and processes necessary for the transfer of the ownership of goods and services to customers after they are made available for sale, it begins with a request by a customer and ends with the conversion of a material or service into an account receivable, and ultimately into cash
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