<span>Tests of controls and substantive tests for sales are types of tests used in an auditing system. The auditor is attempting to validate whether or not financial statements can be legitimized or whether or not they have failed in legitimacy. Tests of controls can include examining documents, whereas substantive tests include a test that looks for mistakes in financial balances or statements.</span>
Answer:
Cost Drivers
Explanation:
Abc generally causes the least amount of cost distortion among products because indirect costs are allocated to the products based on cost drivers.
Activity Based Costing does not apportion indirect costs but allocates them to products based on the level at which they drive those costs.
Cost driving is based on which activities or overheads are used by a product and by how much does it use (drive) those activities.
Answer:
The correct answer is the option B: Flickr.
Explanation:
Flickr is the name given to a <em>web site</em> whose characteristics involves the image and video hosting service for its users and the main purpose for this webpage is to give the user the possibility to <em>seek and sell photos</em> and videos in an ordenated date base where they can upload their images and videos to the site, as well as share them with the other users, creating at the same time an online social community. Therefore that it is understandable that <u><em>if Noah is trying to share his photos he will use Flickr in order to do that</em></u>.
Answer:
B. Escalator Clause
Explanation:
XYZ development acts as landlord to businesses, there is agreement that rent can change based on the level of tax. An escalator clause is a clause in any agreement that gives room for increase in prices under certain condition. If an agreement has got an escalator clause, if for instance the tax rate rises, then the prices rise proportionately. In this case of XYZ Development Inc., the escalator clause is in use. The correct answer is B.
Answer: The adjustment for uncollectible amount will be: Debit Bad debt expense $1,958.35 Credit Allowance for bad debt $1,958.35.
Explanation: The answer above assumes that the balance in the account receivable is $5,300 not as past due. 35% of the account receivable balance is $1,855, resulting in an initial balance of $3,445, then further 3% of the balance will be $103.35. Therefore, the total bad debt expense will be $1,958.35. This will be debited to Bad debt expense and credited to Allowance for bad debt expense ledger. The credit to allowance for bad debt account is a balance sheet line and would further reduce the account receivable balance to $3,341.65.
