Management Has Recorded Prepaid Insurance as an Asset in the Previous

question 116

Multiple Choice

Management has recorded prepaid insurance as an asset in the previous year. This year, to reduce record-keeping costs, it expenses insurance. If the amount is immaterial to the financial statements,

• A) a disclaimer opinion is issued.
• B) a qualified opinion is issued.
• C) a standard unmodified opinion audit report is issued.
• D) no audit report can be issued.

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Definitions:

Stepparents

Individuals who are married to one's biological parent but are not their biological mother or father, often playing significant roles in child-rearing.

Custodial Fathers

Fathers who have been granted primary legal and/or physical custody of their child by a court following a separation or divorce.

Rescue Fantasy

A psychological pattern where an individual harbors a desire to rescue others, often rooted in a need to feel valued or to avoid one's own problems.

Stepchild

A child of one’s spouse by a previous partner, who one does not biologically parent but may fulfill a parental role for.