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Both Overstatements and Understatements Must Be Considered When Allocating Materiality

question 135

True/False

Both overstatements and understatements must be considered when allocating materiality to balance sheet accounts.


Definitions:

Skewed

A description of a distribution that is not symmetrical, with a longer tail on one side of the central peak than the other, indicating that it is either left or right skewed.

Bimodal

Having or characterized by two distinct peaks or modes in a distribution of values.

Asymmetrical

Lacking symmetry; having parts that fail to correspond to one another in shape, size, or arrangement.

Mode

The most repeatedly occurring number in a set of data.

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