Procedures Used to Verify Accounting Reports and Statements Are Referred

question 63

Multiple Choice

Procedures used to verify accounting reports and statements are referred to as a(n)

• A)management audits.
• B)accounting audits.
• C)activity-based costing (ABC).
• D)financial analysis.
• E)budget audit.

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Definitions:

Consolidated Statement

A financial statement that aggregates the financial position and results of operations of a parent company and its subsidiaries as a single entity.

Push-down Accounting

An accounting method used in situations of acquisitions, where the financial statements of the acquired company are restated to reflect the acquirer's basis of assets and liabilities.

Equity Method

An accounting technique used by firms to assess the profits earned from their investments in other companies, where they own a significant but not controlling interest, typically recognized as 20% to 50% ownership.

Consolidation

The process of combining the financial statements of a parent company with those of its subsidiaries to present as if the group is a single entity.