The Negative Form of Accounts Receivable Confirmation Request Is Useful

question 79

Multiple Choice

The negative form of accounts receivable confirmation request is useful except when:

• A) a large number of small balances are involved.
• B) the internal control structure surrounding accounts receivable is considered to be effective.
• C) individual account balances are relatively large and few in number.
• D) the auditor has reason to believe the persons receiving the requests are likely to give them consideration.

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Definitions:

Economic Growth

An increase in the production of goods and services over a specific period, often measured by GDP.

Production

The process of creating goods and services through the combination of labor, materials, and capital.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two goods, given a fixed amount of resources and technology.

Deep Depression

An extended period of significant decline in the economy, characterized by high unemployment, sharp decreases in output and trade, and widespread poverty.