Which of the Following Isnot a Primary Objective in the Audit

question 36

Multiple Choice

Which of the following isnot a primary objective in the audit of interest-bearing debt?

• A)Establish the completeness of recorded interest-bearing debt.
• B)Establish the legality of outstanding debt.
• C)Determine that debt is properly valued.
• D)Determine that the presentation and disclosure of interest-bearing debt is appropriate.

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Definitions:

Expense Accounts

Accounts used to record the costs incurred to operate a business, which are then matched against revenues to determine net income.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been deducted from total revenue.

Net Loss

The amount by which total expenses exceed total revenues for a business over a specified period, indicating financial performance.

Nominal Accounts

Accounts that are closed at the end of each accounting period, including revenue, expense, and withdrawal accounts.