To Determine Whether Any Accounts Receivable Are Pledged or Assigned

question 48

Multiple Choice

To determine whether any accounts receivable are pledged or assigned to others,the auditor would most likely perform which of the following procedures?

• A)Examine subsequent collections.
• B)Test a sample of transactions to the general ledger.
• C)Review loan agreements and board of directors' meeting minutes.
• D)Derive an independent estimate of the allowance and compare it to pledged assets.

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Definitions:

Oxygen Affinity

The tendency of a molecule, such as hemoglobin, to bind with oxygen. A higher affinity means oxygen is more tightly held.

Blood Chemistry

The analysis of chemical components in the blood, often used to diagnose conditions and assess organ function.

Diagnostic Blood Test

A medical test performed on a blood sample to determine the presence of diseases, conditions, or infections.

Carbon Dioxide

A gas that is both colorless and odorless, created through the combustion of carbon and organic materials as well as during the process of respiration, which is then utilized by plants during photosynthesis.