The Primary Difference Between Positive and Negative Confirmations Used in the Audit

question 93

Multiple Choice

The primary difference between positive and negative confirmations used in the audit of accounts receivable is which of the following?

• A)The mode of response.
• B)The amount of information included.
• C)The control of the confirmation process by the auditor.
• D)The method in which accounts are selected for confirmation.

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Definitions:

Actual Labor Hours

The real number of hours worked by employees, used in various calculations such as labor costing and efficiency analysis.

Raw Material

Basic materials that are used in the production process to create goods or finished products.

Standard Cost

A predetermined cost of manufacturing a single unit or a number of units during a specific time period for budgeting and financial control.

Journalize

The process of recording transactions in the journal of a company, detailing the financial activities.