The Ultimate Purpose of Assessing Control Risk Is to Contribute

question 877

Multiple Choice

The ultimate purpose of assessing control risk is to contribute to the auditor's evaluation of the risk that:

• A) Specific internal control activities are not operating as designed.
• B) The collective effect of the control environment may not achieve the control objectives.
• C) Tests of controls may fail to identify activities relevant to assertions.
• D) Material misstatements may exist in the financial statements.

---

Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Supply and Demand

Fundamental economic concepts where supply represents how much the market can offer, and demand represents how much of a product or service is desired by buyers.

Supply and Demand

Economic principles stating that the price of a good is determined by its availability (supply) and consumers' desire to purchase it (demand).

Price of the Good

The amount of money required to purchase a specific product or service in the market.