The 'Going Concern' assumption in audit is evaluated by: MCQ with Answer and Explanation

Question

Share Report Error

The 'Going Concern' assumption in audit is evaluated by:

A. Shareholders

B. Tax department

C. Auditor to assess whether the entity can continue in operation

D. Management only

Answer: Option C

Solution (By JKSSB Mock Tests)

Auditor must consider the appropriateness of management's use of going concern basis.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Accountancy and Book Keeping Questions

Question #1

The term 'Debtors' represent:

A. Outstanding expenses

B. Amounts owed to the business by customers

C. Bills payable

D. Amounts owed by the business

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option B

Explanation:
Debtors are persons/entities who owe money to the business for goods/services provided on credit.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

In cost accounting, the term 'Opportunity Cost' means:

A. The cost of raw materials

B. The depreciation cost

C. The benefit foregone by choosing one alternative over another

D. The actual cost incurred

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option C

Explanation:
Opportunity cost is the potential benefit that is given up when one alternative is selected over another.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

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. S2 only

B. Both S1 and S2

C. Neither S1 nor S2

D. S1 only

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option D

Explanation:
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.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Explore All Accountancy and Book Keeping MCQs