Solution-Which methods are used in doing substantive

Which methods are used in doing substantive procedures

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Reference no: EM132987185

Problem 1: The following methods are used in doing substantive procedures for interest expense and discounts/premiums, except:

a. The Initial carrying amount of the bond is determine by deducting transaction cost from the present value of the bond or cash price equivalent

b. In doing the amortization table for the testing, if what is to be amortized is a premium, the formula should be "= interest payment less interest expense".

c. One cannot perform the goal-seek formula without having the amortization table formatted.

d. Effective interest rate for the bond is determined using the goal-seek formula in excel.

e. none of the above.

Problem 2: In testing relative party transaction for financial liability the auditor should do the following, except:

a. Confirmation should be made only to those related party transactions that are material.

b. Consider whether balances at large indicate the existence of a previously undisclosed related party.

c. None of the above

d. Consider if there are related party transactions not given appropriate accounting treatment.

e. Inquire for related party transaction from the client

Reference no: EM132987185

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Which methods are used in doing substantive procedures

Reference no: EM132987185

Reference no: EM132987185

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