In an Effort to Satisfy the Completeness Objective,the Auditor Could

question 48

Multiple Choice

In an effort to satisfy the completeness objective,the auditor could perform which of the following test of details of balance procedures?

• A)Trace the book balance on the reconciliation to the general ledger.
• B)Trace outstanding cheques to subsequent period bank statements.
• C)Obtain and test a cutoff bank statement.
• D)Review financial statements to make sure that material savings accounts and certificates of deposit are disclosed separately.

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Definitions:

Normal Profit

The minimum profit necessary for a company to remain competitive in the market, often considered the cost of doing business.

Marginal Cost

The cost increase associated with the production of an extra unit of a product or service.

Competitive Firms

Businesses that operate in a market environment where they vie with others to offer goods or services, focusing on price, quality, and innovation.

Monopolists

Individuals or entities that hold a monopoly, controlling the entire supply of a good or service in a particular market, eliminating competition.