Question 16 - Auditors need to examine purchase and/or lease contracts entered into related to property, plant, and equipment, to determine if capitalization of the property, plant, and equipment is appropriate or not.True False

Which of the following statements about the audit of fixed assets is the least correct?

(3pts)

Question 17 - Which of the following statements about the audit of fixed assets is the least correct?

	Failure to record the acquisition of a fixed asset affects the income statement until the assets are fully depreciated.
	The emphasis on auditing fixed assets is on verification of current-period acquisitions.
	Manufacturing equipment and current assets are normally audited in the same fashion regardless of the activity within a particular account.
	The primary accounting record for manufacturing equipment and other property, plant and equipment is generally a fixed asset master file.

Typically, analytical procedures are the primary means of verifying income statement accounts resulting from allocations.

Question 18 - Typically, analytical procedures are the primary means of verifying income statement accounts resulting from allocations.True False

In the audit of equipment and related accounts, verifying that the ending balances are properly classified and are adequately disclosed in the financial statements is one of the tests the auditor must perform.

(3pts)

Question 19 - In the audit of equipment and related accounts, verifying that the ending balances are properly classified and are adequately disclosed in the financial statements is one of the tests the auditor must perform.True False