Cutoff testing ensures that:

A All employees are paid

B Transactions are recorded in the correct accounting period

C Inventory is counted

D Cash is balanced

✓ Correct Answer: Option B

Cutoff tests verify transactions near period-end are recorded in the proper period—not shifted to manipulate results.

💡 Why is B) the correct answer?

The correct answer to the question "Cutoff testing ensures that:" is Option B: Transactions are recorded in the correct accounting period.

The other options — A) All employees are paid, C) Inventory is counted, D) Cash is balanced — are incorrect for this CPA Exam Prep question. As explained above: Cutoff tests verify transactions near period-end are recorded in the proper period—not shifted to manipulate results.

📚 About This CPA Exam Prep Practice Question

This 2-level CPA Exam Prep question from the Auditing & Attestation (AUD) topic is part of BrainForge Quiz's free exam preparation library. Each question includes the correct answer and a detailed explanation to help you understand the underlying concept, not just memorize the answer.

How to use this page: Read the question above, consider all four options (A through D), then check the highlighted correct answer and explanation. For active timed practice, start a free CPA Exam Prep practice test or use flashcards for spaced repetition review.

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Cutoff testing ensures that:

✓ Correct Answer: Option B

📚 About This CPA Exam Prep Practice Question

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