In Considering Overall Materiality for Planning Purposes, an Auditor Believes

question 5

Multiple Choice

In considering overall materiality for planning purposes, an auditor believes that misstatements aggregating $10,000 would have a material effect on an entity's income statement but that misstatements would have to aggregate $20,000 to materially affect the balance sheet. Ordinarily, it would be appropriate to design audit procedures that would be expected to detect misstatements aggregating:

• A)$10,000.
• B)$15,000.
• C)$20,000.
• D)$30,000.

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Definitions:

Skin Pigmentation

Refers to the coloring of a person's skin determined by the amount and type of melanin produced by the skin cells.

Phenotype

The set of observable characteristics or traits of an organism, resulting from the interaction of its genotype with the environment.

Extra Chromosome

An additional chromosome in the genetic makeup of an individual, which can lead to various developmental and physical disorders.

Down Syndrome

A genetic disorder caused by the presence of an extra 21st chromosome, leading to developmental and physical changes.