The Tests of Details of Balances Procedure Which Requires the Auditor

question 55

Multiple Choice

The tests of details of balances procedure which requires the auditor to examine notes paid after year-end to determine whether they were liabilities at the balance sheet date is an attempt to satisfy the audit objective of

• A) existence.
• B) completeness.
• C) accuracy.
• D) classification.

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Definitions:

Exit Value

The estimated amount that an asset or investment could be sold for at the end of its useful life.

Economic Resource

Assets or inputs that have the potential to contribute to the production of goods and services, providing economic benefit to businesses or individuals.

Asset

Resources owned or controlled by a business, projected to bring future economic benefits.

Measurement Alternative

An accounting option that allows entities to measure certain investments at cost, minus impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer.