Testing cutoff involves procedures applied to sales transactions selected from those recorded immediately prior to period end and immediately following period end.

Question

Quizplus · Accepted Answer

Testing cutoff typically involves selecting transactions from immediately before and after the period end to ensure that sales are properly recorded in the correct period. This helps to prevent sales from being recorded in the wrong period, which can distort financial statements and mislead investors.

Testing Cutoff Involves Procedures Applied to Sales Transactions Selected from Those