Explain how examining subsequent payments paid after the balance sheet date (or a cutoff date) is...

Explain how examining subsequent payments paid after the balance sheet date (or a cutoff date) is a useful test of the completeness of purchases and payables.

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Expert Solution

Examining subsequent payments paid after the balance sheet date (or a cutoff date) become necessary sometimes because such payments paid are much in value and could not be ignored.
It can be a useful test of the completeness of purchases and payables as there can be certain purchases made after the balance sheet date.

Examination of actual stock available with the invoices made after the balance sheet date (or a cutoff date) will help in checking in completeness of purchases and playables.

Such examination will help in achieving the actual figures and the operating income can be fairly determined.

ekkarill92 answered 1 year ago

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