“Units of abnormal spoilage are inferred rather than identified.”Explain.

Q: “The inspection point is the key to the allocation of spoilage costs.” Do you agree? Explain.

A: Spoilage: Spoilage is the defective item at intermediate or final stage. The spoilage goods cannot…

Q: What items could increase the risk of material misstatement?

A: Risk of material misstatement (ROMM) is a risk that the financial statements when audited will…

Q: What are the two sampling risks associated with attributes sampling? What types of losses…

A: Sampling risk is a risk that arises when the judgments based on the sample varies from the…

Q: Explain Deficiency Judgment?

A: To borrow funds, borrower might be required to mortgage its property to the lender. In case that…

Q: Why is there a need to re-evaluate impairments due to trigger events?

A: When-ever there are any types of assets which are non-tangible assets as well as tangible assets…

Q: What must occur if a Significant Deficiency is identified?

A: Definition:   Internal control: Internal control is a process which ensures continuous reliability…

Q: “Costs of abnormal spoilage are losses.”Explain.

A: Abnormal spoilage is spoilage that is not inherent in a specific production process and will not…

Q: Disadvantage of institutional based correction

A: Following is the answer to the given question

Q: Discuss the differences between a control deficiency, a significant deficiency, a material weakness,…

A: Control deficiency: A control deficiency is a flaw in the functioning or design of a control system…

Q: DEFINE AND INDICATE TYPES OF DUMPING.

A: Dumping: Dumping refers to the reduced price of the products at which price the exporters exports…

Q: Explain errors of principle and give two examples with measures to rectifythem.

A: An error of principle is an accounting mistake in which an entry is recorded in the incorrect…

Q: Determine if the mistake is counterbalancing or noncounterbalancing. Give a specific example for…

A: The mistake is counterbalancing or noncounterbalancing will be explained:

Q: What is Normal spoilage?

A: Definition:   Spoilage: Spoilage is the defective item at intermediate or final stage. The spoilage…

Q: Statistical sampling cannot be used to test all control activities. TRUE OR FALSE? WHY?

A: Solution : Concept Statistical sampling               In an audit two methods of sampling can be…

Q: “Normal spoilage is planned spoilage.”Discuss.

A:

Q: “What has been regarded as normal spoilage in the past is not necessarily acceptable as normal…

A: Spoilage:   Spoilage is the defective item in an intermediate or final stage. The spoilage goods…

Q: What is a Control Deficiency?

A:

Q: “Total input includes abnormal as well as normal spoilage and is, therefore, inappropriate as a…

A: Inventory shrinkage: It represents the loss of inventory. In other words, it refers to the…

Q: Disruptions to operations are a common side effect of implementing an ERP. Explain the primary…

A: ERP: Enterprise resource planning is management software that helps in integrating all the…

Q: An inaccurate estimate of asset needs can have serious consequences. Explain how?

A: Estimates of assets:  Estimate of assets is the estimated worth of assets of original worth of…

Q: What is required if a Material Weakness is identified?

A:

Q: What tests may be conducted for identifying unauthorized program changes?

A:

Q: What are (a) an internal control deficiency, (b) a significant deficiency, and (c) a material…

A:

Q: What is the meaning of “statistically significant” in relation to the null hypothesis?

A: Null hyptohesis is the assumption of no effect or no relationship between variables. The Null…

Q: When is the timing of substantive procedures most flexible? O detection risk is assessed as low O…

A: Substantive procedure refers to a process performed by the auditor in order to detect the material…

Q: Operational risks may result from breakdowns in ______ procedures, people and systems as opposed to…

A: Operational risks Operational risks are referred to as that risk that includes errors because of the…

Q: Risk of material misstatements increases if

A: Please see the next step for the solution

Q: If detective controls signal error flags, why shouldn’t this type of controls automatically make a…

A: Definition:   Internal control: Internal control involves the norms and rules which are followed…

Q: Define the term spoilage.

A: Definition:   Product costs: The costs incurred to acquire the merchandise, ship the stock, prepare…

Q: What is an uncorrected misstatement?

A: Auditing:   Auditing refers to an independent examination of financial information of any…

Q: What is a MIS report, why is it  prepared?

A: MIS is Management Information System. Management information system is an integrated collection of…

Q: “The unit cost of normal spoilage is the same as the unit cost of abnormal spoilage.”Do you agree?…

A:

Q: Only sets of non-nominal items that presumably belong to reflective latent factors are acceptable…

A: Definition: Analysis of Factors (EFA): An experiment's variables are analyzed using statistical…

Q: risk of material misstatemen-

A: Risk of material misstatement is the vulnerability of financial statements to errors or frauds that…

Q: Thich of the following is FALSE regarding various methods of project analysis?

A: The following methods reflect the time value of money: Net Present Value Internal Rate of Return…

Q: Which of the following components is not used in determining the upper limit on misstatements?a.…

A: Auditors generally uses Sampling Tools to find any error.

Q: Define risk of material misstatement.

A: Material misstatement represents the statement presented in the financial statement which is…

Q: Non-sampling risk, and more specifically the risk of assessing control risk too low (risk of…

A: Non-sampling risk is the risk that auditors make an incorrect conclusion for any reason that is not…