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Management Sciences 5307 MCQs [All-Courses]

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Management Sciences focuses on the planning, organizing, leading, and controlling of resources to achieve organizational goals.This subject is highly important for competitive exams, academic study, and professional careers in the business and public sectors.

All Topics  5307

What is the primary objective of analytical procedures used in the overall review stage of an audit?
A To help to corroborate the conclusions drawn from individual components of financial statements
B To reduce specific detection risk
C To direct attention to potential risk areas
D To satisfy doubts when questions arise about a client’s ability to continue
Correct Answer: To help to corroborate the conclusions drawn from individual components of financial statements
When applying analytical procedures, an auditor could develop independent estimate of an account balance to compare it to­___________?
A client’s unedited account balance
B client’s unedited account balance adjusted for trends in the industry
C Prior year audited balance
D Prior year audited balance adjusted for trends in the industry
Correct Answer: Prior year audited balance
Which of the following is not an analytical procedure?
A Tracing of purchases recurred in the purchase book to purchase invoices.
B Comparing aggregate wages paid to number of employees
C Comparing the actual costs with standard costs
D All of them are analytical procedure
Correct Answer: Tracing of purchases recurred in the purchase book to purchase invoices.
What are analytical procedures?
A Substantive tests designed to assess control risk
B Substantive tests designed to evaluate the validity of management’s representation letter
C Substantive tests designed to study relationships between financial and non­financial
D All of the above
Correct Answer: Substantive tests designed to study relationships between financial and non­financial
The basic assumption underlying the use of analytical procedures is:____________?
A It helps the auditor to study relationship among elements of financial information
B Relationship among data exist and continue in the absence of known condition to the contrary
C Analytical procedures will not be able to detect unusual relationships
D None of the above.
Correct Answer: Relationship among data exist and continue in the absence of known condition to the contrary
Which of the following statements is most closely associated with analytical procedure applied at substantive stage?
A It helps to study relationship among balance sheet accounts
B It helps to discover material misstatements in the financial statements
C It helps to identify possible oversights
D It helps to accumulate evidence supporting the validity of a specific account balance
Correct Answer: It helps to accumulate evidence supporting the validity of a specific account balance
Analytical procedures issued in the planning stage of an audit, generally?
A helps to determine the nature, timing and extent of other audit procedures
B directs attention to potential risk areas
C indicates important aspects of business
D All of the above
Correct Answer: All of the above
In determining the level of materiality for an audit, what should not be considered?
A Prior year’s errors
B The auditor’s remuneration
C Adjusted interim financial statements
D Prior year’s financial statements
Correct Answer: The auditor’s remuneration
When issuing unqualified opinion, the auditor who evaluates the audit findings should be satisfied that the_____________?
A Amount of known misstatement is documented in working papers
B Estimates of the total likely misstatement is less than materiality level
C Estimate of the total likely misstatement is more than materially level
D Estimates of the total likely misstatement cannot be made
Correct Answer: Estimates of the total likely misstatement is less than materiality level
_______the audit risk,_______the materiality and _______the audit effort?
A Lower, Higher, Lower
B Lower, Lower, Higher
C Higher, Lower, Lower
D Lower, Higher, Higher
Correct Answer: Lower, Higher, Lower
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