Which of the Following Is False Regarding the Use of an Audit

question 143

Multiple Choice

Which of the following is false regarding the use of an audit checklist for disclosures?

• A)It is a convenient documentation format.
• B)It reminds the auditor of matters that should be considered for disclosure.
• C)It can be organized to include relevant professional guidance.
• D)It covers all potential unusual circumstances.

---

Definitions:

Unit Product Costs

The total cost (including materials, labor, and overhead) divided by the number of units produced, representing the cost per individual unit.

External Financial Reports

Financial statements prepared for external users like shareholders, creditors, and regulatory agencies.

Direct Materials

The raw materials that are used directly in the production of a product.

Manufacturing Overhead

All indirect costs associated with manufacturing, including expenses related to indirect labor, indirect materials, maintenance, and utilities in the production facility.