Benford's Law Assists in the Audit of Which Area(s)

question 12

Multiple Choice

Benford's law assists in the audit of which area(s) :

• A) leases.
• B) cash disbursements.
• C) accruals and reserves.
• D) All of the above.

---

Definitions:

Straight-Line Method

An accounting method that allocates an equal portion of the cost of an asset over its useful life for the purposes of depreciation.

Depreciation Expense

Allocating the expense of a physical asset in a structured manner throughout its service life.

Double-Declining Balance Method

The Double-Declining Balance Method is an accelerated depreciation technique that doubles the rate of straight-line depreciation to allocate a asset's cost more quickly.

Activity Method

A depreciation technique that allocates the cost of an asset over its useful life based on its level of activity, such as units produced or hours used.