The Standard of Due Care to Which the Auditor Is

question 112

Multiple Choice

The standard of due care to which the auditor is expected to adhere to in the performance of the audit is referred to as the

• A) prudent person concept.
• B) common law doctrine.
• C) constructive care concept.
• D) vigilant person concept.

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Definitions:

Fixed Asset Turnover

A ratio in finance that evaluates how effectively a business utilizes its fixed assets to produce sales.

Inventory Costing

The process of assigning costs to inventory items and determining cost of goods sold, using methods like FIFO, LIFO, or weighted average.

Physical Inventory

A count of all the physical goods and materials in stock at a business, used to verify records and account balances.

Net Income

The remaining profit for a company after subtracting total expenses, taxes, and costs from its total income.