Exam 19: Completing the Tests in the Acquisition and Payment Cycle: Verification of Selected Accounts

The estimated unpaid obligations for services or benefits that have been received before the balance sheet date are

After the accrual and property tax expense for each piece of property has been recalculated, the totals are added and compared with the general ledger.

Which of the following accounts is not associated with the acquisition and payment cycle?

When auditing depreciation expense, the two major concerns related to the accuracy audit objective are

You are the in-charge auditor for a company who has been an audit client for several years. Which of the following is not a category of tests commonly associated with the audit of manufacturing equipment?

The auditor's knowledge of the client's business is important when auditing management's judgements in evaluating whether a long-lived asset is impaired or not, including estimating fair value of these assets.

Tests of controls provide an indication of the likelihood of misstatements in both the income statement and the balance sheet, simultaneously.

Using audit software to foot the equipment master file and agreeing the master file total to the general ledger is generally sufficient when verifying the ending balance of the equipment account.

When auditing accrued property taxes,

Which of the following expenses is not typically evaluated as part of the audit of the acquisition and payment cycle?

Methods used to determine if there are legal encumbrances related to fixed assets include all but which of the following?

One of the primary objectives in examining the repairs and maintenance accounts is to obtain evidence that

The auditor's starting point for verifying disposals of property, plant, and equipment is the

In connection with a review of the prepaid insurance account, which of the following audit procedures would you be least likely to use?

The auditor needs to be aware that most users of financial statements rely most heavily on the ________ for making decisions.

The auditor normally does not need to test the accuracy or classification of fixed assets recorded in prior periods if they are the continuing auditor because

Changing circumstances may require a change in the useful life of an asset. When this occurs, it involves a change in

When auditors verify accrued property taxes, two audit objectives are especially significant. These are

The auditor must know the client's capitalization policies to determine whether acquisitions are

Normally it may be unnecessary to examine supporting documentation for each addition to property, plant, and equipment, but it would be customary to verify