Which of the Following Is True About an Auditor's Responsibility

question 372

Multiple Choice

Which of the following is true about an auditor's responsibility with respect to accounting estimates?

• A) The auditor is responsible for both preparing accounting estimates and evaluating their reasonableness.
• B) The auditor is responsible for preparing accounting estimates in accordance with generally accepted auditing standards.
• C) The auditor is responsible for evaluating the reasonableness of accounting estimates.
• D) The auditor has no responsibility with respect to accounting estimates.

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Definitions:

Yards Raked

The total area of yards cleared of leaves or debris, serving as an indicator of performed maintenance or service activity.

Average Product

The output produced per unit of input, calculated by dividing total product by the quantity of input used in its production.

Labor

The human effort, both physical and mental, used in the production of goods and services.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, keeping all other inputs constant.