An Auditor Compares This Year's Revenues and Expenses with Those

question 19

Multiple Choice

An auditor compares this year's revenues and expenses with those of the previous year and investigates all changes exceeding 10 per cent. By carrying out this procedure the auditor would be most likely to learn that:

• A) an increase in property tax rates has not been recognised in the client's accrual.
• B) the provision for uncollectible accounts is inadequate because of worsening economic conditions.
• C) fourth-quarter payroll taxes were not paid.
• D) the client changed its capitalisation policy for small tools.

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Definitions:

Standard Deviation

A measure that quantifies the variation or dispersion of a set of data points around their mean, indicating how spread out the data points are.

Sample Size

The number of individual observations or data points used in a statistical sample.

Variance

A measure of the dispersion or spread of a set of data points, indicating how far each data point in the set is from the mean.

Variance

A measure of the dispersion of a set of data points around their mean, reflecting how spread out the data is.