Generally Accepted Auditing Standards State That Analytical Procedures

question 115

Multiple Choice

Generally accepted auditing standards state that analytical procedures

• A) Should be applied in the planning and final review stages of the audit and as a substantive test during the audit.
• B) Should be applied in the planning and final review stages of the audit and can be used as a substantive test during the audit.
• C) Should be applied in the planning stage and can be applied as a substantive test in the final review stage.
• D) Should be applied in the final review stage and can be applied as a substantive test in the planning stage.

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Definitions:

Job Order

A work instruction or order for producing a specific quantity of a product or service according to customer specifications.

Conversion Cost

The combined costs of direct labor and manufacturing overheads associated with converting raw materials into finished products.

Direct Labor

The labor cost of workers who are directly involved in the manufacture of products or the provision of services.

Factory Overhead

All indirect costs associated with manufacturing, such as utilities, maintenance, and salaries of non-direct labor.