An Important Part of Evaluating Whether the Financial Statements Are

question 63

Multiple Choice

An important part of evaluating whether the financial statements are fairly stated is summarising the misstatements uncovered in the audit.Whenever the auditor uncovers misstatements that are in themselves material:

• A) it is necessary to combine individually immaterial misstatements with the material misstatements and make entries to correct the statements.
• B) it is necessary to combine individually immaterial misstatements with the material misstatements and make full disclosure in the footnotes.
• C) the trial balance should be adjusted to correct the statements.
• D) no entries need be made, but footnote disclosure is required.

---

Definitions:

Uni-directional

Capable of moving or operating in only one direction, often used in reference to devices or mechanical components.

Maximum Twisting Force

The highest torque a rotating shaft or component can withstand without yielding or failing.

Rated Horsepower

The measure of an engine's or motor's horsepower as officially designated by the manufacturer.

Shaded Pole

A type of single-phase induction motor with a shading coil used to create a delayed magnetic field for starting torque.