Benchmarks Are Needed for Evaluating Materiality

question 11

Multiple Choice

Benchmarks are needed for evaluating materiality.If you used operating profit before income tax, what minimum percentage would you use for planning materiality?

• A) 5%
• B) 10%
• C) 1%
• D) none of the above

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Definitions:

Event Contingencies

The relationship between actions and outcomes in a given situation.

Tolman

Edward Chace Tolman was a cognitive psychologist who introduced the concept of cognitive maps in learning theory.

Expectations

Beliefs or predictions about future events that can influence an individual's perception and behavior.

Drives

Internal states of tension or arousal that motivate behavior towards fulfilling specific needs or goals.