The Audit Working Papers Serve as a Record of the Evidence

question 23

Multiple Choice

The audit working papers serve as a record of the evidence accumulated and the results of the audit tests.This helps to demonstrate that the audit was

• A)kept properly confidential;information was held secure.
• B)completed using Canadian generally accepted accounting principles.
• C)organized effectively with no mistakes in calculations.
• D)conducted in accordance with Canadian generally accepted auditing standards.

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Definitions:

Inventory Accounts

Accounts used to track the cost of goods a company has in stock during an accounting period, including raw materials, work in progress, and finished goods.

Actual Overhead Costs

The real costs that a company incurs for its indirect materials, indirect labor, and other overhead expenses.

Direct Labour Cost

The wages and benefits paid to workers who are directly involved in the manufacturing process.

Manufacturing Overhead Applied

The allocation of overhead costs to the goods produced, based on a predetermined overhead rate.