Which of the Following Is a Major Balance-Related Audit Objective

question 130

Multiple Choice

Which of the following is a major balance-related audit objective in testing payroll liabilities?

• A) Payroll tax expense is properly recorded.
• B) Transactions in the payroll and personnel cycle are recorded in the proper period.
• C) Accrual of salaries is the same as the amounts paid on the payroll tax returns.
• D) Time records are recorded by supervisors.

---

Definitions:

Sold

Refers to the completion of a transaction where goods or services are exchanged for payment.

Recording Depreciation

The process of allocating the cost of a tangible asset over its useful life to reflect its decrease in value over time.

Expense Recognition Principle

An accounting principle stating that expenses should be recorded in the period in which they contribute to revenue, not necessarily when the expense is paid.

Fully Depreciated

An asset has reached the end of its useful life, and its book value is reduced to salvage value or zero.