In an Audit Test of Recorded Interest Expense and Accrued

Multiple Choice

In an audit test of recorded interest expense and accrued interest, the auditor was able to detect that the recorded interest expense was higher than the calculations showed. This may indicate:

A) a failure to accrue interest occurred.
B) interest payments are in default.
C) interest payments were charged to another account.
D) interest was paid on an unknown debt or unrecorded liability.