The Audit Procedures Used to Verify Accrued Liabilities Differ from Those

question 92

Multiple Choice

The audit procedures used to verify accrued liabilities differ from those employed for the verification of accounts payable because:

• A)accrued liability balances are less material than accounts payable balances.
• B)accrued liabilities at year end will become accounts payable during the following year.
• C)evidence supporting accrued liabilities is non-existent, whereas evidence supporting accounts payable is readily available.
• D)accrued liabilities usually pertain to services of a continuing nature, whereas accounts payable are the result of completed transactions.

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Definitions:

Business Strength

The distinct advantages or capabilities a company has that give it a competitive edge in the market.

BCG Matrix

A strategic analysis tool that helps organizations prioritize their business units or products by categorizing them into four types based on market growth and market share: Stars, Cash Cows, Question Marks, and Dogs.

Cash Flow

Cash flow refers to the net amount of cash and cash-equivalents being transferred into and out of a business.