Author: Lorraine S. Lee, Associate Professor of Accounting, University of North Carolina

This educational case requires students to perform audit steps for an auto dealership’s revenue for the year. Students are provided with electronic working papers that include a summary of the weekly gross margin. By analyzing the transactions associated with automobile sales, students are provided an opportunity to test account balances and to consider potential reasons the balances may deviate from expected values.

The case provides students an example of a substantive procedure the auditor can conduct in testing accounts affected by the revenue process. By analyzing the transactions associated with automobile sales, students are can test account balances and to consider potential reasons the balances may deviate from expected values.

The case provides students an example of a task that an audit intern or first year associate might be asked to perform. It also provides an opportunity for Accounting students to use and to integrate concepts from financial, managerial, audit, statistics and systems classes.

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