Which of the Following Statements Is Generally Correct About the Appropriateness

question 42

Multiple Choice

Which of the following statements is generally correct about the appropriateness of audit evidence?

• A)The more effective the internal control, the more assurance it provides about the reliability of the accounting data and financial statements.
• B)Appropriateness of audit evidence refers to the amount of corroborative evidence obtained.
• C)Information obtained indirectly from independent outside sources is more persuasive than the auditor's direct personal knowledge obtained through observation and inspection.
• D)Appropriateness of audit evidence refers only to audit evidence obtained from outside the entity.

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Definitions:

Net Sales

Total sales for the time period minus sales returned and adjustments made during the same time.

Percentage of Net Change

The ratio or fraction, expressed as a percentage, that represents the difference between the old value and the new value divided by the old value, often used to measure growth or decline.

Comparative Income Statement

A financial statement that compares income, expenses, and net income over different periods to observe trends or changes.

Sales

Transactions involving the exchange of goods or services for money.