Auditing Is

question 174

Multiple Choice

Auditing is

• A)the examination of financial statements by a CPA in order to express an opinion on their fairness.
• B)a part of accounting that involves only the recording of economic events.
• C)an area of accounting that involves such activities as cost accounting, budgeting, and accounting information systems.
• D)conducted by the Securities and Exchange Commission to ensure that registered financial statements are presented fairly.

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Definitions:

Cost-Reimbursement Contract

A type of contract where the purchaser agrees to pay the supplier for all actual costs incurred plus a fee or profit.

Selling Price

The amount of money consumers pay to purchase a product or service, set by sellers based on costs, market demand, and competition.

Allocation System

A method of distributing resources, costs, or revenues among various departments, products, or activities based on predetermined criteria.

Cost Control

The practice of managing and reducing business expenses through efficient use of resources.