Which of the Following Is Not an Acceptable Manner of Testing

question 16

Multiple Choice

Which of the following is not an acceptable manner of testing an audit client's estimates?

• A) Compare subsequent actual amounts to the accounting estimates.
• B) Recalculate accounting estimates using management's process.
• C) Prepare an independent estimate and compare with management's result.
• D) Observe management's process of calculating estimates.

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Definitions:

Joseph Galloway's Plan

A proposal made by Joseph Galloway in 1774 during the First Continental Congress to seek a reconciliation between the American colonies and Great Britain, which was ultimately rejected leading towards the path of independence.

Taxation

The process by which governments finance their expenditure by imposing charges on citizens and corporate entities.

Legislation

Laws or statutes enacted by a governing body to regulate, authorize, sanction, grant, declare, or restrict various activities.

Virtual Representation

The concept that the British government claimed gave American colonists political representation through the Parliament, despite the colonists having no actual representatives.