Which of the following best describes the independent auditors approach to obtaining satisfaction concerning depreciation expense in the income statement?
31.Which of the following best describes the independent auditors' approach to obtaining satisfaction concerningdepreciation expense in the income statement?A. Verify the mathematical accuracy of the amounts charged to income as a result of depreciation expense.B. Determine the method for computing depreciation expense and ascertain that is in accordance withgenerally accepted accounting principles.C. Reconcile the amount of depreciation expense to those amounts credited to accumulated depreciationaccounts.D.Establish the basis for depreciable assets and verify the depreciation expense.Which of the following best describes the independent auditors' approach to obtainingsatisfaction concerning depreciation expense in the income statement? A) Verify themathematical accuracy of the amounts charged to income as a result of depreciationexpense. B) Determine the method for computing depreciation expense and ascertainthat is in accordance with generally accepted accounting principles. C) Reconcile theamount of depreciation expense to those amounts credited to accumulated depreciationaccounts. D) Establish the basis for depreciable assets and verify the depreciationexpense. Answer: D Difficulty: Medium Source: AICPA 32. The auditors are least likelyto learn of retirements of equipment through which of the following? A) Review of thepurchase returns and allowances account. B) Review of depreciation. C) Analysis of thedebits to the accumulated depreciation account. D) Review of insurance policy riders.Answer: A Difficulty: Hard Source: AICPA 33. For which of the following ledger accountswould the auditor be most likely to analyze the details to identify understatements ofequipment acquisitions? A) Service Revenue. B) Sales. C) Repairs and maintenanceexpense. D) Sales salaries expense. Answer: C Difficulty: Medium Source: AICPAWhittington, Principles of Auditing, Fifteenth Edition 216 Chapter 13 Property, Plant, andEquipment 34. Which of the following is the most important control procedure overacquisitions of property, plant, and equipment? A) Establishing a written company policy
