The Auditors May Use Data Analytics to Help Test Repairs

question 16

Multiple Choice

The auditors may use data analytics to help test repairs and maintenance expense for overstatement by:

• A)Vouching  large repair and maintenance expenditures.
• B)Identifying expenditures with characteristics that indicate they are capital expenditures.
• C)Identifying capital expenditures that should have been expensed.
• D)Identifying expenditures for repairs and maintenance that were not performed.

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Definitions:

Patent

is a legal right granted to an inventor or assignee, providing exclusive rights to make, use, or sell an invention for a certain number of years in exchange for public disclosure of the invention.

Pure Monopolist

A market situation where a single seller controls all the supply of a product or service with no close substitutes.

Imperfectly Competitive

Describes market structures that do not meet the conditions of perfect competition, often characterized by the presence of market power held by firms.

Nondiscriminating Monopolist

A monopolist that charges a single price for all units of a product sold, rather than engaging in price discrimination among different consumers.