MNE and Associates Is Auditing Blanchard Company

question 157

Multiple Choice

MNE and Associates is auditing Blanchard Company.MNE has decided to use 5% of income (earnings) before income tax as a benchmark.If income (earnings) before income tax was $33 million, what would be the amount of planning materiality?

• A)$1.65 million
• B)$31.43 million
• C)$660,000
• D)$34.65 million

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Definitions:

At Rest

A state where an object or individual is not in motion and is devoid of external forces acting upon it.

Left Brain

The hemisphere of the brain that is often associated with analytical and logical processes, including language, math, and reasoning skills.

Right Brain

Refers to the right hemisphere of the brain, often associated with creative thinking, intuition, and artistic skills.

Logical

Pertaining to or based on the principles of logic, involving clear and coherent reasoning.