The Tests of Details of Balances Procedure That Requires the Auditor

question 11

Multiple Choice

The tests of details of balances procedure that requires the auditor to examine notes paid after year-end to determine whether they were liabilities at the balance sheet date is an attempt to satisfy the audit objective of

• A)existence.
• B)completeness.
• C)accuracy.
• D)classification.

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Definitions:

Marginal Productivity Theory

An economic principle that explains how the amount of extra output gained by employing an additional unit of input declines as more of that input is used.

Monopoly and Monopsony

A monopoly refers to a market with a single seller facing many buyers, whereas a monopsony is a market with a single buyer facing many sellers.

Marginal Product

The extra production resulting from the increase of a particular input by one unit, while keeping all other inputs unchanged.

Price of Labor

The compensation or wage paid to employees for their work or labor, often determined by market forces or negotiations.