Because the Failure to Record Disposals of Property, Plant, and Equipment

question 95

Multiple Choice

Because the failure to record disposals of property, plant, and equipment can significantly affect the financial statements, the search for unrecorded disposals is essential.Which of the following is not a procedure used to verify disposals?

• A)Make inquiries of management and production personnel about the possibility of the disposal of assets.
• B)Review whether newly acquired assets replace existing assets.
• C)Test the valuation of fixed assets recorded in prior periods.
• D)Review plant modifications and changes in product line, taxes, or insurance coverage.

Develop critical thinking skills to evaluate ethical dilemmas in business.

Appreciate the significance of social responsibility and ethical standards in business sustainability.

Understand the broad implications of social media for personal and corporate blogs.

Comprehend the meaning and scope of social media.

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Definitions:

Nonconforming Goods

Goods that fail to meet the specifications or standards outlined in a contract.

Course of Dealing

A term defining the established behavior and interaction patterns between contracting parties over time, building a context for interpreting their agreements.

Risk of Loss

denotes the possibility that an asset or investment's value will decrease, reflecting the chance of losing on an investment or possession.

Contract Voided

A legal declaration that a contract is null and void and, therefore, unenforceable as though it never existed.