When Evaluating the Risk of Material Misstatement with Regards to Defalcations

question 63

Multiple Choice

When evaluating the risk of material misstatement with regards to defalcations involving receivables (a credit entry to accounts receivable for amounts not received) , the auditor would expect an experienced bookkeeper to most likely
Debit which of the following accounts?

• A) Cash.
• B) Sales returns.
• C) Miscellaneous income.
• D) Accounts payable.

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