Exam Details

  • Exam Code
    :CPA-TEST
  • Exam Name
    :Certified Public Accountant Test: Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, Regulation
  • Certification
    :AICPA Certifications
  • Vendor
    :AICPA
  • Total Questions
    :1241 Q&As
  • Last Updated
    :Jun 30, 2025

AICPA AICPA Certifications CPA-TEST Questions & Answers

  • Question 921:

    Negative confirmation of accounts receivable is less effective than positive confirmation of accounts receivable because:

    A. A majority of recipients usually lack the willingness to respond objectively.

    B. Some recipients may report incorrect balances that require extensive follow-up.

    C. The auditor cannot infer that all nonrespondents have verified their account information.

    D. Negative confirmations do not produce audit evidence that is statistically quantifiable.

  • Question 922:

    Confirmation is most likely to be a relevant form of evidence with regard to assertions about accounts receivable when the auditor has concerns about the receivables:

    A. Valuation.

    B. Classification.

    C. Existence.

    D. Completeness.

  • Question 923:

    In a comparison of 20X2 to 20X1, ABC Co.'s inventory turnover ratio increased substantially although sales and inventory amounts were essentially unchanged. Which of the following statements explains the increased inventory turnover ratio?

    A. Cost of goods sold decreased.

    B. Accounts receivable turnover increased.

    C. Total asset turnover increased.

    D. Gross profit percentage decreased.

  • Question 924:

    An auditor vouched data for a sample of employees in a payroll register to approved clock card data to provide assurance that:

    A. Payments to employees are computed at authorized rates.

    B. Employees work the number of hours for which they are paid.

    C. Segregation of duties exists between the preparation and distribution of the payroll.

    D. Internal controls relating to unclaimed payroll checks are operating effectively.

  • Question 925:

    An auditor most likely would extend substantive tests of payroll when:

    A. Payroll is extensively audited by the state government.

    B. Payroll expense is substantially higher than in the prior year.

    C. Overpayments are discovered in performing tests of details.

    D. Employees complain to management about too much overtime.

  • Question 926:

    The purpose of segregating the duties of hiring personnel and distributing payroll checks is to separate the:

    A. Human resources function from the controllership function.

    B. Administrative controls from the internal accounting controls.

    C. Authorization of transactions from the custody of related assets.

    D. Operational responsibility from the recordkeeping responsibility.

  • Question 927:

    An auditor most likely would perform substantive tests of details on payroll transactions and balances when:

    A. Cutoff tests indicate a substantial amount of accrued payroll expense.

    B. The assessed level of control risk relative to payroll transactions is low.

    C. Analytical procedures indicate unusual fluctuations in recurring payroll entries.

    D. Accrued payroll expense consists primarily of unpaid commissions.

  • Question 928:

    Which of the following procedures most likely would be considered a weakness in an entity's internal controls over payroll?

    A. A voucher for the amount of the payroll is prepared in the general accounting department based on the payroll department's payroll summary.

    B. Payroll checks are prepared by the payroll department and signed by the treasurer.

    C. The employee who distributes payroll checks returns unclaimed payroll checks to the payroll department.

    D. The personnel department sends employees' termination notices to the payroll department.

  • Question 929:

    The sampling unit in a test of controls pertaining to the existence of payroll transactions ordinarily is a (an):

    A. Clock card or time ticket.

    B. Employee Form W-2.

    C. Employee personnel record.

    D. Payroll register entry.

  • Question 930:

    In evaluating the reasonableness of an accounting estimate, an auditor would be least likely to use which of the following approaches?

    A. Review subsequent events or transactions occurring prior to audit completion.

    B. Develop an independent expectation of the estimate.

    C. Review and test the process used to develop the estimate.

    D. Review the minutes of board of directors and shareholder meetings for discussion of the estimate.

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