Alternative Procedures That Would Provide Evidence of the Existence of Receivables

question 57

Multiple Choice

Alternative procedures that would provide evidence of the existence of receivables would include which of the following?

• A)Physical observation of customer facilities.
• B)Review of subsequent collections.
• C)Analysis of the aged trial balance.
• D)A confirmation to the client management for customer accounts.

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Definitions:

Variable Cost

Costs that vary in accordance with a company's operational volume.

Fixed Costs

Costs that do not change with the level of output or activity, including salaries, rent, and insurance.

Activity Level

A measure of the amount of work or production a business undertakes, which can affect costs and efficiencies.

Total Cost Line

A graphical representation of how total costs change with changes in the level of activity or production volume.