Which Assertions May Be Tested for the "Account Balances" Category

question 35

Multiple Choice

Which assertions may be tested for the "account balances" category of management assertions?

• A)Existence, cutoff, rights and obligations, completeness.
• B)Existence, rights and obligations, completeness, accuracy, valuation, allocation, and presentation.
• C)Occurrence, rights and obligations, completeness, valuation and allocation.
• D)Occurrence, accuracy, rights and obligations, completeness.

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Definitions:

Resource Prices

The cost of inputs used in the production of goods or services, such as raw materials, labor, and energy.

Sunk Costs

Costs that have already been incurred as a result of past decisions. They are sometimes referred to as historical costs.

Variable Costs

Expenses that fluctuate in direct proportion to the level of output or production activity.

Stock Purchase

The action of buying shares in a company, which represents a portion of ownership in that corporation.