When auditing depreciation expense, the two major concerns related to the accuracy audit objective are:
A) consistent application of depreciation method and useful lives.
B) consistent application of depreciation method and classification of assets.
C) correctness of calculations and consistent application of depreciation method.
D) cost of the fixed asset and useful lives.

Question

Quizplus · Accepted Answer

The accuracy audit objective for depreciation expense involves verifying the correctness of calculations and ensuring consistent application of the depreciation method. While useful lives are also an important factor in calculating depreciation expense, it is primarily a matter of estimation and can be subject to change based on various external factors. Therefore, choice A and D are not the best choices. Similarly, classification of assets is not directly related to the accuracy of depreciation expense, making choice B incorrect.

When Auditing Depreciation Expense, the Two Major Concerns Related to the Accuracy