The audit of the repairs and maintenance expense account is extremely important as it helps the auditor to determine if
A)depreciation expense includes charges for repairs.
B)the net book value of assets achieves precision.
C)items that should be included as assets are charged as expenses.
D)all repairs and maintenance expenses add value to the assets.

Question

Quizplus · Accepted Answer

The audit of the repairs and maintenance expense account helps the auditor to determine if items that should be included as assets are charged as expenses. This is important because if such items are not capitalized as assets, the financial statements will not reflect the true economic value of the company's assets. Therefore, the auditor must ensure that repairs and maintenance expenses are properly classified as either expenses or capitalized as assets in accordance with the company's accounting policies and accounting standards. The other choices are not directly relevant to the audit of the repairs and maintenance expense account.

The Audit of the Repairs and Maintenance Expense Account Is