Much of the Early Planning of Audits Deals with Obtaining

question 6

Multiple Choice

Much of the early planning of audits deals with obtaining information to help auditors assess two risks:

• A) acceptable audit risk and business risk.
• B) business risk and inherent risk.
• C) acceptable audit risk and inherent risk.
• D) none of the above

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Definitions:

Facility Expenses

Costs associated with the physical locations where a business operates, such as rent, utilities, and maintenance expenses.

Flexible Budget

A budget that adjusts or flexes for changes in the volume of activity.

Food

Any nutritious substance that people or animals eat or drink or that plants absorb to maintain life and growth.

Supplies

Items used in the operations of a business, usually not directly part of the finished product but necessary for production or administrative tasks.