Holding Other Planning Considerations Equal, a Decrease in the Amount

question 871

Multiple Choice

Holding other planning considerations equal, a decrease in the amount of misstatements in a class of transactions that an auditor could tolerate most likely would cause the auditor to:

• A) Apply the planned substantive tests prior to the balance sheet date.
• B) Perform the planned auditing procedures closer to the balance sheet date.
• C) Increase the assessed level of control risk for relevant financial statement assertions.
• D) Decrease the extent of auditing procedures to be applied to the class of transactions.

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Definitions:

Goods Manufactured

The total value or volume of products that have been completed and are ready for sale during a specific accounting period.

Ending Work

Often referred to the ending work in process (WIP) inventory, it represents the value of products that are partially completed at the end of an accounting period.

Process Inventory

Inventory that is currently in various stages of the production process but not yet completed.

Manufacturer

An individual or company involved in the process of making goods for sale through the use of raw materials, components, or assemblies.