An Auditor Compares Information on Canceled Checks with Information Contained

question 23

Multiple Choice

An auditor compares information on canceled checks with information contained in the cash disbursements journal. The objective of this test is to determine that:

• A)recorded cash disbursement transactions are properly authorized.
• B)proper cash purchase discounts have been recorded.
• C)cash disbursements are for goods and services actually received.
• D)no discrepancies exist between the data on the checks and the data in the journal.

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Definitions:

Weighted Average Cost of Capital (WACC)

A calculation of a company's cost of capital, weighted by the proportion of each source of capital (debt and equity), used to see how much interest the company pays for every dollar it finances.

Cost of Preferred Stock

The dividend required to be paid by an entity for the funds received from issuing preferred shares, typically expressed as a percentage.