In Violation of Company Policy, Morley Ltd (Morley) Erroneously Capitalised

Multiple Choice

In violation of company policy, Morley Ltd (Morley) erroneously capitalised the cost of painting its warehouse.The auditor examining 'Morley's financial report would most likely detect this when:

A) examining maintenance expense accounts.
B) observing during the physical inventory observation that the warehouse had been painted.
C) examining the construction work orders supporting items capitalised during the year.
D) discussing the capitalisation policies with 'Morley's financial controller.