The Audit Objective to Determine That Existing Loans Payable Are

question 107

Multiple Choice

The audit objective to determine that existing loans payable are included in the loans payable schedule (completeness) is accomplished by the following test of balances procedure:

• A) Trace the individual loans payable on the schedule to the master file.
• B) Examine duplicate copies of loan agreements for principal and interest rates.
• C) Review loans to determine whether any are related-party loans or accounts payable.
• D) Review the bank reconciliation for new loans credited directly to the bank account by the bank.

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Definitions:

Conditional

An if-then statement in logic, signifying that if the first condition is true, then the second condition follows.

Disjunction

A Boolean function that yields a true value when any one or more of its inputs are true.

Conjunction

A part of speech that connects words, phrases, or clauses within sentences.

Symbolize

To represent something abstract by a symbol or symbols.