In Evaluating Whether There Is a Sufficiently Low Probability of Material

question 30

Multiple Choice

In evaluating whether there is a sufficiently low probability of material misstatement in the financial statements,the auditors accumulate:

• A)Factual misstatements in the financial statements.
• B)Judgmental misstatements in the financial statements.
• C)Factual and judgmental misstatements in the financial statements.
• D)Factual,judgmental and projected misstatements and an allowance for undetected misstatements in the financial statements.

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Definitions:

Life Estate

An interest in land ending at death of the estate holder.

Co-Owner

An individual or entity that holds ownership rights in property or assets jointly with one or more parties.

Court Order

An official directive issued by a judge that requires a person or entity to do or refrain from doing something.

Restrictive Covenant

In property law, a condition imposed by the seller as to what the purchaser can use the land for; in employment law, a commitment not to work in a certain geographical area for a designated period of time.