Which of the Following Statements Is True Concerning the Allocation

question 155

Multiple Choice

Which of the following statements is true concerning the allocation of preliminary materiality?

• A) It is necessary to allocate preliminary materiality to financial statements as a whole rather than by segments.
• B) Preliminary materiality should be allocated to income statement accounts only.
• C) Preliminary materiality is required by the SEC.
• D) The PCAOB term used when preliminary materiality is allocated to segments is tolerable misstatement.

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Definitions:

Abraham Maslow

An American psychologist known for creating Maslow's hierarchy of needs, a theory in psychology proposing that certain fundamental needs must be satisfied before higher needs can be pursued.

Drive Theories

Theories in psychology that explain motivation as being driven by biological needs that demand satisfaction.

Approach Theories

A set of theories in psychology that focus on the motivations driving individuals towards certain behaviors or goals.

Empirical Evidence

Information acquired by observation or experimentation that is used to confirm or disprove a hypothesis or theory.