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An Auditor Uses Sampling to Determine the Reasonableness of an Account

question 42

True/False

An auditor uses sampling to determine the reasonableness of an account balance by performing detailed analysis of the selected items making up the account balance.


Definitions:

Instrument Due

This term refers to the date on which a financial instrument, such as a check or note, is payable.

Bearer

A person in the possession of an instrument payable to bearer or indorsed in blank.

Negotiable

Capable of being transferred or modified in terms of agreement or ownership through endorsement or delivery.

On Demand

A service or product made available whenever requested by a customer, often implying immediate or quick delivery.

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