Evidence Is Generally Considered Appropriate When

question 63

Multiple Choice

Evidence is generally considered appropriate when

• A) it has been obtained by random selection.
• B) there is enough of it to afford a reasonable basis for an opinion on financial statements.
• C) it is relevant to the audit objective being tested.
• D) it consists of written statements made by managers of the company under audit.

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Definitions:

Single Cost Pool

A simplified accounting method that aggregates all costs into one category.

Activity-based Costing

An accounting method that assigns costs to products or services based on the activities and resources that go into producing them, providing precise cost information.

First Stage

The initial phase in a process or development where foundational elements are established.

Cost Objects

Items or activities for which costs are measured and assigned, such as products, services, or projects.