A company forgot to record four adjustments during 2016 . Which one of the following omissions of adjustments will understate net income?
a. Sales made during the last week of the period are not recorded.
b. Interest on monies borrowed has not yet been recorded.
c. Prepaid insurance is not reduced for the portion of the policy that has expired during the period.
d. Income taxes owed but not yet paid are ignored.
a
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Which of the following is required of an auditor who is testing the fair value of options in share-based compensation?
A. Using the work of the internal audit function. B. Testing the inputs used in the valuation model. C. Becoming an expert in option-pricing. D. Using a specialist.
Which of the following statements is true regarding GAAP and reporting operating activities on the statement of cash flows?
A) The direct method is required of large companies. B) GAAP expresses a preference for the indirect method. C) GAAP expresses a preference for the direct method. D) GAAP did not express a preference for either the direct or indirect method.
The accounting rate-of-return method is widely used to measure the estimated performance of a capital investment, primarily because it is very accurate
Indicate whether the statement is true or false
Larger companies typically break their customers into distinct markets.
Answer the following statement true (T) or false (F)