Auditing MCQ question

17- The absence of reasonable care that can be expected of a person in a set of circumstances is a) Ordinary negligence b) Gross negligence 18- c) Fraud usebesosowes occurs when a misstatement is made and there is both the knowledge of its falsity and the intent to deceive. a) Fraud b) Gross negligence c) Constructive fraud 19- To examine the ownership of the inventory we can use a) Documentation b) Confirmation c) Physical examination 20- To check number of inventory items we can use ") Physical examination b) Confirmation c) Observation 21- To check the accounts payable balance we can use a) Observation b) Confirmation c) Physical examination 22- To check the cash in bank balance we can use a) Observation b) Confirmation c) Physical examination 23- failure A business is unable to meet its obligations or investor expectations due to economic or business conditions a) business b ) audit c) ethics 24- During your audit of Jody, Inc., you conclude that there is a possibility that creditors are materially overstated. The client allows you to expand the scope of your audit sufficiently to verify whether the balance is actually misstated. And you conclude that the balance is correct., your opinion will be a) disclaimer "bj qualified c) unqualified 25- You complete the audit of KFS Department Store, and in your opinion, the financial statements are fairly presented. On the last day of the audit, you discover that one of your supervisors assigned to the audit has a material investment in KFS. your opinion will be a) disclaimer b) qualified c) unqualified 26- Cairo Company has a fleet of several delivery trucks. In the past, Auto Delivery had followed the policy of purchasing all equipment. In the current year, they decided to lease the trucks. The method of accounting for the trucks is therefore changed to lease capitalization. This change in policy is fully disclosed in footnotes. your opinion will be a) disclaimer b) qualified c) unqualified 27- You are auditing Deep Clean Services for the first time. Deep Clean has been in business for several years but over the last two years has struggled to stay afloat given the economic conditions. Based on your audit work, you have substantial doubt that Deep Clean will be in business by the end of its next fiscal year. your opinion will be a) adverse b) unqualified modified wording c) unqualified with explanatory paragraph 28- One of your audit clients has a material investment in a privately-held biosciences company. Your audit firm engaged a business valuation specialist to assist in evaluating the client's estimation of the investment's fair value, your opinion will be