The Auditor Has Completed Analyzing the Results of Tests of Details

question 37

Multiple Choice

The auditor has completed analyzing the results of tests of details of the accounts receivable ending balance.Errors totaling $25 000 were found.These exceptions are

• A)indications that the credit limit is being incorrectly applied.
• B)probably cutoff errors that can be explained.
• C)an indication of potential errors in the ending balance.
• D)financial statement misstatements.

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Definitions:

Accounts Receivable

Represents the money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Supplies

Materials or items used in the operation of a business or needed in the process of providing a service or making goods.

Accounts Payable

Liabilities owed by a company to its creditors for goods or services that have been delivered or used but not yet paid for.

Balance Sheet

A balance sheet is a financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, giving insight into its financial health.