The 3,000 Accounts Receivable of DEF Company Have a Total

question 26

Multiple Choice

The 3,000 accounts receivable of DEF Company have a total book value of $60,000.Bob Smith,CPA,has selected and audited a sample of 100 accounts with a total book value of $2,100.Using the difference estimation technique,Smith has properly estimated a projected misstatement of a $9,000 overstatement for the entire population.The estimated total audited value of the population is:

• A)$51,000
• B)$58,000
• C)$60,000
• D)$69,000

Identify and understand the legal and ethical implications of insider trading.

Recognize the roles and responsibilities of individuals in preventing and reporting insider trading.

Distinguish between tipper and tippee liability within the context of securities trading.

Understand the concept of securities fraud and the various defenses that can be deployed against such accusations.

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Balance Sheet

A report detailing a business's assets, liabilities, and shareholders' equity at a particular date, serving as an overview of its financial situation.

Permanent Account

An account that is not closed at the end of the accounting period and whose balances are carried forward into the next period.

Allowance for Doubtful Accounts

An accounting method used to estimate the portion of accounts receivable that is expected not to be collected.