Substantive Tests of Property, Plant and Equipment Often Focus on _______

question 20

Multiple Choice

Substantive tests of property, plant and equipment often focus on _______.

• A)Agreeing the beginning balance in property, plant and equipment to the prior year's audit
• B)Auditing the acquisition of new property, plant and equipment
• C)Auditing the disposal of property, plant and equipment
• D)All of these answer choices are correct.

---

Definitions:

Operating Activities

Part of a company’s cash flow statement that shows the cash inflows and outflows related to its core business operations.

Statement of Cash Flows

A financial statement that reports a company's cash inflows and outflows over a period, categorized into operating, investing, and financing activities.

Total Assets

This represents the sum of all owned resources that have economic value and can contribute to future benefits for a company, including both current and non-current assets.

Free Cash Flow

The amount of operating cash flow remaining after replacing current productive capacity.