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1. Long-lived assets include which of the following? a. Tangible assets such as equipment. b. Intangible assets such as patents. c. Natural resources. d. All of the above.

1. Long-lived assets include which of the following? a. Tangible assets such as equipment. b. Intangible assets such as patents. c. Natural resources. d. All of the above.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Multiple Choice Questions 1. Long-lived assets include which of the following? a. Tangible assets such as equipment. b. Intangible assets such as patents. c. Natural resources. d. All of the above. 2. Which of the following statement is true? Existence and valuation assertions related to long-lived assets åre usually the most relevant assertions. b. A concern´regarding the existence of long-lived assets relates to whether management has properly recorded depreciation. c. Depletion expense is not an account that would be included when auditing long-lived assets. d. All of the above statements are true. а. 3. Which of the following is not an inherent risk related to long-lived asset. accounts? a. Failing to record asset disposals. b. `Capitalizing repairs and maintenance expense. c. Changing depreciation estimates to manage earnings. d. All of the above. 4. Which of the following risks is an inherent risk related to asset impairment? a. Determining asset impairment is based on management judgment. b. It is difficult to identify the costs associated with the discovery of natural resources. c. Management might have incentives to not record all asset disposals. d. All of the above are inherent risks related to asset impairment. 5. Which of the following statements is false regarding fraud risk factors related to long-lived assets, tangible and intangible? A potential fraud scheme involves not removing sold assets from the books. а. b. Because long-lived assets are typically an audit area of low risk, auditors do not need to perform brainstorming activities related to long-lived assets. Management might use unreasonably long depreciable lives in an effort to reduce expenses, d. None of the above statements is false. с.
Transcribed Image Text:Multiple Choice Questions 1. Long-lived assets include which of the following? a. Tangible assets such as equipment. b. Intangible assets such as patents. c. Natural resources. d. All of the above. 2. Which of the following statement is true? Existence and valuation assertions related to long-lived assets åre usually the most relevant assertions. b. A concern´regarding the existence of long-lived assets relates to whether management has properly recorded depreciation. c. Depletion expense is not an account that would be included when auditing long-lived assets. d. All of the above statements are true. а. 3. Which of the following is not an inherent risk related to long-lived asset. accounts? a. Failing to record asset disposals. b. `Capitalizing repairs and maintenance expense. c. Changing depreciation estimates to manage earnings. d. All of the above. 4. Which of the following risks is an inherent risk related to asset impairment? a. Determining asset impairment is based on management judgment. b. It is difficult to identify the costs associated with the discovery of natural resources. c. Management might have incentives to not record all asset disposals. d. All of the above are inherent risks related to asset impairment. 5. Which of the following statements is false regarding fraud risk factors related to long-lived assets, tangible and intangible? A potential fraud scheme involves not removing sold assets from the books. а. b. Because long-lived assets are typically an audit area of low risk, auditors do not need to perform brainstorming activities related to long-lived assets. Management might use unreasonably long depreciable lives in an effort to reduce expenses, d. None of the above statements is false. с.
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