In deciding on the reasonableness of the useful lives assigned to newly acquired assets, the auditor must consider which of the following factors?
A) the expected life of the asset
B) policies on trading in equipment
C) the actual physical life of the asset
D) all of the above

Question

Quizplus · Accepted Answer

The auditor must consider all the listed factors: the expected life of the asset, policies on trading in equipment, and the actual physical life of the asset, to decide on the reasonableness of the useful lives assigned to newly acquired assets. These factors help in assessing how long the asset is expected to be used in the business and its potential resale or trade-in value, which are critical for accurate depreciation calculations and financial reporting.

In Deciding on the Reasonableness of the Useful Lives Assigned