Match the Audit Step Below with Its Appropriate Area

question 65

Essay

Match the audit step below with its appropriate area. You may use an area more than once and more than one area may apply.
(a) Trace amounts per the cash disbursement journal to the appropriate liability account:
(b) Trace the stock issued per the transfer agent report to equity:
(c) Trace EPS to net income and stockholders' equity:
(d) Trace overfunded liability amount to actuary report:
(e) Recalculate interest expense using face amount and current terms:
(f) Recalculate compensation expense using stock compensation plans approved by the board of directors:
(g) Recalculate stock compensation expense using a model such as Black-Scholes for valuation:
(h) Recalculate taxes payable:
(i) Review debt covenants:
(j) Review cash equivalents for maturity:

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Definitions:

Inaccurate Assertions

Statements or claims that are not based on facts or truth, often leading to misunderstandings or misinformation.

Innuendo

An indirect or subtle, usually derogatory implication in expression; an insinuation.

Comparison Group

In research, a group of subjects used as a benchmark to measure the effects or outcomes of a specific variable or intervention in another group.

Exposed

Revealed or disclosed, often something that was previously hidden or secret.