After Considering an Entity's Negative Trends and Financial Difficulties,an Auditor

question 34

Multiple Choice

After considering an entity's negative trends and financial difficulties,an auditor has substantial doubt about the entity's ability to continue as a going concern.The auditor's considerations relating to management's plans for dealing with the adverse effects of these conditions most likely would include management's plans to:

• A)Increase current dividend distributions.
• B)Reduce existing lines of credit.
• C)Increase ownership equity.
• D)Purchase assets formerly leased.

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Definitions:

Law Firms

Professional business organizations composed of lawyers who engage in the practice of law.

Corporations

Organizations that exist independently from their proprietors, with the ability to possess assets, engage in agreements, and face litigation.

Networking

Making personal connections and cultivating relationships with people in a certain field, profession, or area of interest.

Personal Business Connections

Relationships or networks established between individuals through their professional activities for mutual benefit.