The Purpose of Tests of Controls Is to Determine Whether

question 45

Multiple Choice

The purpose of tests of controls is to determine whether ________.

• A)internal control policies and procedures are working as prescribed
• B)substantive testing can be kept to a minimum
• C)errors and irregularities are prevented or detected in a timely manner
• D)the auditor has an understanding of the control system

Identify and apply the principles of capitalization of interest costs.

Recognize the accounting treatment for the disposal and exchange of property, plant, and equipment.

Understand the GAAP requirements for property, plant, and equipment.

Apply the concept of fair value measurement in the context of property, plant, and equipment.