EXHIBIT 7.64.1 a. Sales recorded, goods not shipped b. Goods shipped, sales not recorded C. Goods shipped to a bad credit risk customer d. Sales billed at the wrong price or wrong quantity е. Product line A sales recorded as Product line B f. Failure to post charges to customers for sales g. January sales recorded in December CONTROL PROCEDURES 1. Sales order approved for credit 2. Prenumbered shipping doc prepared, sequence checked 3. Shipping document quantity compared to sales invoice 4. Prenumbered sales invoices, sequence checked 5. Sales invoice checked to sales order 6. Invoiced prices compared to approved price list 7. General ledger code checked for sales product lines 8. Sales dollar batch totals compared to sales journal 9. Periodic sales total compared to same period accounts receivable postings 10. Accountants have instructions to date sales on the date of shipment 11. Sales entry date compared to shipping doc date 12. Accounts receivable subsidiary totaled and reconciled to accounts receivable control account 13. Intercompany accounts reconciled with subsidiary company records 14. Credit files updated for customer payment history 15. Overdue customer accounts investigated for collection
EXHIBIT 7.64.1 a. Sales recorded, goods not shipped b. Goods shipped, sales not recorded C. Goods shipped to a bad credit risk customer d. Sales billed at the wrong price or wrong quantity е. Product line A sales recorded as Product line B f. Failure to post charges to customers for sales g. January sales recorded in December CONTROL PROCEDURES 1. Sales order approved for credit 2. Prenumbered shipping doc prepared, sequence checked 3. Shipping document quantity compared to sales invoice 4. Prenumbered sales invoices, sequence checked 5. Sales invoice checked to sales order 6. Invoiced prices compared to approved price list 7. General ledger code checked for sales product lines 8. Sales dollar batch totals compared to sales journal 9. Periodic sales total compared to same period accounts receivable postings 10. Accountants have instructions to date sales on the date of shipment 11. Sales entry date compared to shipping doc date 12. Accounts receivable subsidiary totaled and reconciled to accounts receivable control account 13. Intercompany accounts reconciled with subsidiary company records 14. Credit files updated for customer payment history 15. Overdue customer accounts investigated for collection
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Assertion Associations. Exhibit 7.64.1 contains an arrangement of examples of transaction errors (lettered a–g) and a set of client control procedures and devices (numbered 1–15).
Required:
For each error/control objective, identify the assertion about classes of transactions and events most benefited by the control.
Transcribed Image Text:EXHIBIT 7.64.1
a.
Sales recorded, goods not shipped
b.
Goods shipped, sales not recorded
C.
Goods shipped to a bad credit risk customer
d.
Sales billed at the wrong price or wrong quantity
е.
Product line A sales recorded as Product line B
f.
Failure to post charges to customers for sales
g. January sales recorded in December
CONTROL PROCEDURES
1. Sales order approved for credit
2. Prenumbered shipping doc prepared, sequence checked
3. Shipping document quantity compared to sales invoice
4. Prenumbered sales invoices, sequence checked
5. Sales invoice checked to sales order
6. Invoiced prices compared to approved price list
7. General ledger code checked for sales product lines
8. Sales dollar batch totals compared to sales journal
9. Periodic sales total compared to same period accounts
receivable postings
10. Accountants have instructions to date sales on the date of
shipment
11. Sales entry date compared to shipping doc date
12. Accounts receivable subsidiary totaled and reconciled to
accounts receivable control account
13. Intercompany accounts reconciled with subsidiary company
records
14. Credit files updated for customer payment history
15.
Overdue customer accounts investigated for collection
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