The Audit Objective to Determine That Notes Payable and Accrued

question 19

Multiple Choice

The audit objective to determine that notes payable and accrued interest on the notes payable schedule are accurate is accomplished by which of the following test of balances procedure?

• A)Examine duplicate copies of notes for principal and interest rates.
• B)Review the minutes of the board of directors for authorized but unrecorded notes.
• C)Trace the total of the notes payable schedule to the general ledger.
• D)Review the notes to determine whether any are with related parties or should be accounts payable.

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Definitions:

Contingency Approach

A management theory that suggests the best way to manage an organization depends on the specific circumstances and variables present.

Situational Management

Situational management is an adaptive leadership approach that advocates for adjusting management style and strategies based on the specific circumstances and needs of the situation.

McGregor

Douglas McGregor developed the Theory X and Theory Y concept, representing two opposing perceptions of employee motivation and behavior.

Theory X

A management theory that assumes employees are inherently lazy and will avoid work if they can, suggesting the need for strict oversight and control.