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If Management's Report on Internal Control Indicates One or More

question 74

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If management's report on internal control indicates one or more material weaknesses,the auditor would express an adverse opinion on the internal controls.


Definitions:

Job Order Cost

A method of cost accounting that gathers the costs of manufacturing a specific batch or job, including labor, material, and overhead.

Manufacturing Overhead Rate

The ratio of manufacturing overhead costs to the base activity, used to allocate overhead costs to produced goods.

Machine Hours

A measure of production output or operation, calculated as the total number of hours that machinery is in use.

Overapplied Overhead

A situation in managerial accounting where the allocated manufacturing overhead costs are more than the actual overhead incurred.

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