Which of the Following Statements Regarding Types of Operational Audits

question 66

Multiple Choice

Which of the following statements regarding types of operational audits is likely incorrect?

• A) A functional audit has the advantage of permitting specialization by auditors.
• B) An advantage of functional auditing is its ability to evaluate interrelated functions.
• C) The emphasis in an organizational audit is on how efficiently and effectively functions interact.
• D) Special operational auditing assignments arise at the request of management.

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Definitions:

Direct Labor

The labor costs directly associated with the production of goods, such as wages for workers on the manufacturing line.

Direct Materials

Raw materials that are directly used in the manufacturing of a product and can be directly traced to the goods being produced.

Manufacturing Overhead

All indirect costs associated with the production process, such as utilities, maintenance, and salaried labor, that are not directly tied to individual products.

Manufacturing Costs

Costs that are directly associated with the manufacturing of products, such as the cost of raw materials, workforce, and overhead expenses.