In Deciding on the Reasonableness of the Useful Lives Assigned

question 41

Multiple Choice

In deciding on the reasonableness of the useful lives assigned to newly acquired assets, the auditor must consider which of the following factors?

• A) the expected life of the asset
• B) policies on trading in equipment
• C) the actual physical life of the asset
• D) all of the above

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Definitions:

Product Formation

The creation of end products in a chemical reaction, often catalyzed by enzymes in biological systems.

Reactant Formation

The process in a chemical reaction where substances (reactants) combine or change to produce new substances (products).

Equilibrium

A state of physical balance or stability, or the condition in which all competing influences are balanced in a chemical reaction or in a market.

Kinetic Energy

Motion energy or energy that can do work.