Each of the following five cases illustrates specific control activities from a client's revenue cycle (accounts receivable/sales) For each of the procedures, (a) identify which management assertions apply and (b) what potential category of errors and frauds can be prevented.

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Control Procedure A. Credit sales over $1,000 require prior approval by the credit manager. B. All shipping documents must be prenumbered and matched with sales invoices daily. C. Recorded sales must be supported by invoices, shipping documents, and customer orders. D. Sales invoices must be reviewed for correct quantities and mathematical accuracy. E. All sales on credit must be charged to customers' individual accounts. Assertion Error or Fraud Control Procedure A. Credit sales over $1,000 require prior approval by the credit manager. B. All shipping documents must be prenumbered and matched with sales invoices daily. C. Recorded sales must be supported by invoices, shipping documents, and customer orders. D. Sales invoices must be reviewed for correct quantities and mathematical accuracy. E. All sales on credit must be charged to customers' individual accounts. Assertion Error or Fraud

Answer rating: 100% (QA)

Assertion Error or Fraud a Valuation Unauthorized transactions are execu... View the full answer