For each of the following tests, state whether it is a test of details of accoun
ID: 2468459 • Letter: F
Question
For each of the following tests, state whether it is a test of details of account balances or a test of details of transactions. Then note for which property management assertion the test provides evidence. 1. Test depreciation calculations for a sample of capital assets 2. For assets written off, test amounts charged against income and accumulated depreciation 3. Physically examine the capital asset additions 4. Vouch transactions included in repairs and maintenance for items that should be capitalized 5. Vouch significant additions and dispositions to vendor invoices or other supporting documentation 6. Examine of confirm deeds or title documents for proof of ownership
Explanation / Answer
Answer to 1: Test depreciation calculations for a sample of capital assets
It is test of Details of Account Balance, as the calcutes reduction in the value of assets.
The depreciation is calculation on the Basis of Valuation and allocation on the Group of assets.
Answer to 2: For assets written off, test amounts charged against income and accumulated depreciation
it is test of details of Transaction and it is based on accuracy.
Answer to 3: Physically examine the capital asset additions
It is test of details of Accounts Balance and it is based on existence of asset.
Answer to 4: Vouch transactions included in repairs and maintenance for items that should be capitalized
It is test of details of Transaction and it is based on the basis of classification on which repair & maintenance is carried out
Answer to 5: Vouch significant additions and dispositions to vendor invoices or other supporting documentation
It is test of details of Transaction and it will depend upon on the occurence of invoices.
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