The Audit Objective to Determine That Loans Payable in the Schedule

question 47

Multiple Choice

The audit objective to determine that loans payable in the schedule exist is verified by the tests of balances procedure to:

• A) recalculate interest expense.
• B) foot the loans payable list.
• C) examine duplicate copy of loans for authorisation.
• D) examine the balance sheet for proper disclosure of noncurrent portions.

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Definitions:

Constrained Resource

Refers to a limited factor that restricts a company's ability to produce goods or services, such as a machine with finite capacity or limited labor.

Profitable Use

The application or employment of an asset or resource in a manner that generates income or profit.

Craft Shows

Events where artisans and craftsmen display and sell their handmade goods.

Split-Off Point

The stage in the production process where joint products can be recognized as separate products.