Which of the Following Procedures Would Auditors Most Likely Perform

question 29

Multiple Choice

Which of the following procedures would auditors most likely perform in obtaining evidence about subsequent events?

• A)Determine that changes in employee pay rates after year end were properly authorized.
• B)Recompute depreciation charges for plant assets sold after year end.
• C)Inquire about payroll checks that were recorded before year end but cashed after year end.
• D)Investigate changes in long-term debt occurring after year end.

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Definitions:

Strip Bonds

Fixed-income securities that are derived from separating the principal and interest payments of a bond, which are then sold as individual zero-coupon bonds.

RRSP

The Registered Retirement Savings Plan is a financial tool for Canadian workers and self-employed persons, facilitating savings and investments for retirement.

Yield

The return in terms of income from an investment, like dividends or interest earned by possessing a specific security.

Compound-interest

Interest computed on both the original sum invested or loaned, as well as on the interest that has been added to this principal amount over earlier periods.