When an Auditor Tests an Entity's Cost Accounting System, the Auditor's

question 66

Multiple Choice

When an auditor tests an entity's cost accounting system, the auditor's tests are primarily designed to determine that:

• A)quantities on hand have been computed based on acceptable cost accounting techniques that reasonably approximate actual quantities on hand.
• B)physical inventories are in substantial agreement with book inventories.
• C)the system is in accordance with generally accepted accounting principles and is functioning as planned.
• D)costs have been properly assigned to work in process, finished goods, and cost of goods sold.

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Definitions:

Hindbrain

The rear portion of the brain that includes the cerebellum, medulla oblongata, and pons, involved in the regulation of heart rate, respiration, and balance.

Heartbeat

The rhythmic contraction and relaxation of the heart muscle that circulates blood throughout the body, crucial for maintaining life by supplying oxygen and nutrients.

Respiration

The biological process involving the exchange of gases between an organism and its environment, enabling breathing.

Instinctive Behavior

Instinctive behavior is an innate, unlearned response pattern exhibited by an organism when presented with certain stimuli.