Which of the Following Is an Example of a Type

question 54

Multiple Choice

Which of the following is an example of a type of control that may be tested?

• A)Interest accrued on notes payable.
• B)Cash surrender value of life insurance classified as long-term asset.
• C)A spreadsheet used to create a pivot table for the summarization of accounts receivable.
• D)Reconciliations performed monthly on accounts.

---

Definitions:

Conversion Cost

The combined costs of direct labor and manufacturing overhead that are incurred to convert raw materials into finished goods.

Direct Labour Cost

The total cost of wages paid to workers directly involved in manufacturing a product or providing a service.

Manufacturing Overhead

The indirect costs related to manufacturing that are not directly tied to a specific product, such as utilities, rent, and salaries of maintenance staff.

Indirect Costs

Expenses not directly tied to a specific product or service, such as utilities, rent, and administrative salaries, that are necessary for running the business.