Which of the Following Most Likely Would Give the Most

question 35

Multiple Choice

Which of the following most likely would give the most assurance concerning the valuation assertion of accounts receivable?

• A)Tracing amounts in the subsidiary ledger to details on shipping documents.
• B)Comparing receivable turnover rates to industry statistics for reasonableness.
• C)Inquiring about receivables pledged under loan agreements.
• D)Assessing the allowance for uncollectible accounts for reasonableness.

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Definitions:

Expense Account

An accounting entry that represents consumption of assets, decrease in owners' equity, or incurrence of liabilities during a period as a result of operational activities.

Asset Account

A classification within financial accounting that reports the value of a company's long-term resources, such as property, equipment, and intellectual property.

Computer

An electronic device that executes specific tasks or calculations according to a set of instructions or software.

Utilized

Employed or made use of effectively.