To test for recorded sales for which there were no actual shipments, the auditor traces from the:
A) bill of lading to the supporting customer order and sales order.
B) bill of lading to the sales journal.
C) sales journal to the bill of lading.
D) sales journal to the accounts receivable subsidiary ledger.

Question

Quizplus · Accepted Answer

Tracing from the sales journal to the bill of lading will help the auditor to identify if there were any recorded sales for which there were no actual shipments. The bill of lading serves as evidence of actual shipment, and tracing it to the sales journal would enable the auditor to compare the recorded sales with actual shipments. Tracing from the bill of lading to the sales journal (option B) would not be as effective as it would only confirm the sales already recorded. Tracing from the bill of lading to the customer and sales orders (option A) would not necessarily provide information on whether the sales were actually shipped or not. Tracing from the sales journal to the accounts receivable subsidiary ledger (option D) would not provide information on whether the sales were actually shipped or not.

To Test for Recorded Sales for Which There Were No