S1: Audit is an independent examination of financial statements. S2: Audit is conducted to detect all frauds and errors. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: Audit is an independent examination of financial statements. S2: Audit is conducted to detect all frauds and errors. Which statement(s) is/are correct?
A. Neither S1 nor S2
B. S2 only
C. S1 only
D. Both S1 and S2
Answer: Option C
Solution (By JKSSB Mock Tests)
Audit is an independent examination to express an opinion on the financial statements. While it aims to detect material misstatements, it cannot guarantee the detection of *all* frauds and errors due to inherent limitations like sampling and collusion. S1 is correct, S2 is incorrect.
Explanation:
EOQ is the order quantity that minimizes total inventory costs. It achieves this by finding the point where total ordering costs equal total carrying costs. R correctly explains the mechanism of EOQ.
Explanation:
When the trial balance does not tally, the difference is temporarily placed in a Suspense Account to allow the preparation of financial statements.
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