An Auditor Would Be LEAST Likely to Use Confirmations in Connection

question 117

Multiple Choice

An auditor would be LEAST likely to use confirmations in connection with the examination of:

• A) long- term debt.
• B) shareholders' equity.
• C) property, plant and equipment.
• D) inventories.

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Definitions:

Direct Labor-Hours

The total hours worked directly on the production of goods or provision of services, often used as a basis for assigning labor costs to products.

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours expected to complete a task, multiplied by the standard labor rate.

Actual Results

The real, measured outcomes of business activities, such as sales or production levels, compared to planned or forecasted results.

Standard Cost

A predetermined cost of manufacturing, selling, or any other business activity, used as a benchmark for measuring performance.