When Making Decisions About Evidence for a Given Audit, the Auditor's

question 63

Multiple Choice

When making decisions about evidence for a given audit, the auditor's goal is to obtain a sufficient amount of timely, reliable evidence that is relevant to the information being verified, and to do so:

• A) no matter what the cost involved in obtaining such evidence.
• B) at any cost because the costs are billed to the client.
• C) at the lowest possible cost.
• D) only if the cost is reasonable.

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Definitions:

Group Method

A depreciation approach applied to a collection of assets that have similar service lives and uses, treating them as a single asset for depreciation purposes.

Capitalized Trucks

The value of trucks owned by a company that is treated as an asset on the balance sheet and depreciated over time.

Sum-Of-The-Years'-Digits Method

A method of accelerated depreciation calculating annual depreciation expense based on the sum of the years' digits of an asset's useful life.