Tests designed to detect purchases made before the end of the year that have been recorded in the subsequent year most likely would provide assurance about management's assertion of:
A)accuracy.
B)occurrence.
C)cutoff.
D)classification.

Question

Quizplus · Accepted Answer

Tests designed to detect purchases made before the end of the year that have been recorded in the subsequent year are focused on cutoff. Cutoff tests provide assurance that transactions have been recorded in the correct period, which supports the accuracy of financial statements. However, they also test for the occurrence of transactions, which may lead to the detection of possible errors or fraud.

Tests Designed to Detect Purchases Made Before the End of the Year