Almost every asset and liability account requires significant judgments. Which of the following judgments is subject to allowance for uncollectibility?
a. Inventories.
b. Marketable securities.
c. Other receivables.
d. Deferred revenue.
Answer: C
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- Which of the following is an approach used to determine posting materiality?
- Which of the following is not a factor adding to the complexity of materiality judgments made by auditors?
- Which of the following statements is false regarding materiality judgments?
- Which of the following statements is not true about materiality judgments?
- For nonprofit entities, appropriate benchmarks for materiality judgments would include which of the following?
- When a client has significant and nonrecurring charges to nonoperating expenses, which of the following would be the most appropriate materiality benchmark?
- Although different audit firms take different approaches, performance materiality could be the same as overall materiality, or could be a percentage of overall materiality. Generally this range is which of the following?
- Performance materiality helps the auditor to determine which of the following?
- Which of the following would not be a reason to lower the threshold for materiality?
- Which of the following will the auditor will not consider when making a materiality determination?
- Which of the following statements is not true regarding the use of a judgmental approach by auditors in determining whether a misstatement is clearly trivial?
- What document is prepared so that auditors can aggregate potential misstatements in order to assess the materiality of misstatements?
- In which of the following cases is it not necessary for an auditor to revise the original materiality level and document the new materiality amount, as well as the rationale for changing the amount?
- Which of the following best describes the nature of assets of held-for-sale operations?
- Which of the following statements best describe an issue related to inventory?
- Which of the following is least likely to require significant auditor judgment about the dollar amount to be disclosed in the financial statement?
- Which of the following is subject to fair value assessment?
- A reference to another auditor under U.S. auditing standards may result in which of the following?
- A justified departure from GAAP may result in which of the following?
- In which of the following instances would an auditor most likely issue a disclaimer of opinion?
- The opinion paragraph of the audit report for Schnook Company states that the financial statements "do not present fairly". Which type of audit report is this?
- Which of the following would not result in an unqualified audit report with an explanatory paragraph?
- When financial statements contain a material, unjustified departure from GAAP, which of the following is contained in the audit report?
- The division of responsibility between the reporting company's management and the audit firm is described in which one of the following?
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