In the Confirmation of Accounts Receivable, the Auditor Would Most

question 33

Multiple Choice

In the confirmation of accounts receivable, the auditor would most likely

• A) Randomly select a representative sample of accounts for confirmation.
• B) Seek to obtain positive confirmations for at least 50% of the total dollar amount of the receivables.
• C) Require confirmation of all receivables from agencies of the federal government.
• D) Require that confirmation requests be sent within one month of the fiscal year-end.

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Definitions:

Head-And-Shoulders Formation

A technical analysis pattern used to predict reversals in financial markets, characterized by a peak (shoulder), followed by a higher peak (head), and another lower peak (shoulder).

Price Index

An indicator showing the average relative price changes for a specific basket of goods and services over time.

Moving Averages

A method used in technical analysis that smooths out price data by creating a constantly updated average price over a specific time period.

Trend Indicators

Technical analysis tools used to identify and follow the direction of market or asset price trends.