In Considering Materiality for Planning Purposes, an Auditor Believes That

question 79

Multiple Choice

In considering 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 auditing procedures that would be expected to detect misstatements that aggregate:

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

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Definitions:

Groups

Collections of individuals who come together for a common purpose, interest, or activity, sharing certain beliefs, values, or goals.

Socialization Groups

Groups designed to enhance social skills and interactions among members through structured activities and discussions.

Physical Environment

The physical surroundings or conditions in which an individual, community, or organism lives and interacts, including natural and built structures.

Social Environment

The surrounding culture, institutions, people, and relationships that influence an individual's daily life and development.