Which of the Following Would Have the Least Significance in an Audit

question 179

Multiple Choice

Which of the following would have the least significance in an audit of the efficiency of a driver's license testing facility?

• A) Clerical staff administer written tests to allow examiners more time to supervise driving tests.
• B) Staff are cross-trained to provide backup for other areas of the facility as required.
• C) A point-of-sale cashiering system reduces the need to reenter payment data.
• D) Examiners are required to be recertified on an annual basis.

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Definitions:

Direct Labour Hours

The total hours worked by employees directly involved in the production process, not including hours worked by supervisory or maintenance personnel.

Machine Hours

A measure of production time, representing the hours a machine is operated in the manufacturing of a product.

Costing System

A method or procedure adopted by a business to estimate the cost of its products for inventory valuation, cost control, and decision making.

Overapplied Overhead

Occurs when the overhead allocated to products or services is more than the actual overhead costs incurred.