The Audit Tests for Marketable Securities Need Not Include a Review

question 51

True/False

The audit tests for marketable securities need not include a review of broker's advices for cost and sales price of securities as the auditor has more persuasive evidence in the form of deposit tickets and canceled checks.

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Definitions:

Standard Cost Variances

Differences between the estimated costs to produce a good or service and the actual costs incurred.

Cost of Goods Sold

The direct costs associated with producing goods that have been sold, including materials and labor.

Standard Cost System

An accounting method that uses predetermined costs for products and services to help managers control expenses and operations.

Labor Rate Variance

The variance between the real labor expenses and the anticipated (or benchmark) cost.