Which of the following accounts would most likely be reviewed by the auditor to gain reasonable assurance that additions to property, plant, and equipment are not understated or incorrectly classified?
A)Depreciation expense.
B)Accounts payable.
C)Cash.
D)Repairs and maintenance expense.

Question

Quizplus · Accepted Answer

Repairs and maintenance expense would be reviewed to ensure that expenditures that should be capitalized as additions to property, plant, and equipment are not incorrectly expensed. Depreciation expense would be reviewed to ensure accurate calculation of accumulated depreciation, but it does not directly address whether all additions have been properly accounted for. Accounts payable and cash would not provide relevant information about additions to property, plant, and equipment.

Which of the Following Accounts Would Most Likely Be Reviewed