When the Auditor Has Completed the Tests of Details of Balances

question 84

Multiple Choice

When the auditor has completed the tests of details of balances and enters phase IV of the audit process,she must still perform audit procedures for which of the following?

• A)contingent liabilities and employee compensation
• B)contingent liabilities and subsequent events
• C)subsequent events and contractual commitments
• D)subsequent events and unrecorded liabilities

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Definitions:

Economic Profits

Profits calculated by subtracting both explicit and implicit costs from total revenues, often representing the additional benefit over the next best alternative.

Industry Output

The total production or supply of goods and services produced within a specified industry over a given period of time.

Economic Losses

Occur when a company's total costs exceed its total revenues, resulting in a negative profit.

Industry Output

The total production of goods and services by all firms in a specific industry over a given period.