An Auditor's Analytical Procedures Have Revealed That the Accounts Receivable

question 13

Multiple Choice

An auditor's analytical procedures have revealed that the accounts receivable of a client have doubled since the end of the prior year. However, the allowance for doubtful accounts, as a percentage of accounts receivable remained about the same. Which of the following client explanations most likely would satisfy the auditor?

• A) Credit standards were liberalized in the current year.
• B) Twice as many accounts receivable were written off in the prior year as compared to this year.
• C) A greater percentage of accounts were currently listed in the "more than 90 days overdue" category than in the prior year.
• D) The client opened a second retail outlet in the current year and its credit sales approximately equaled the older, established outlet.

Recognize the significance of networks and networking in contemporary organizational structures.

Distinguish between the management functions of planning, leading, organizing, and controlling.

Assess the challenges faced by managers in the 21st-century workplace.

Explain the concepts of productivity, performance effectiveness, and performance efficiency and their interrelationships.

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Definitions:

Assets GM and GE

Refers to the tangible and intangible items owned by General Motors (GM) and General Electric (GE) that are used in their operations to generate revenue.

Beta

A measure of the volatility, or systematic risk, of a security or portfolio in comparison to the market as a whole.

Evolution

The gradual development of something, often used in the context of the biological process by which organisms change over generations.

Forecast

The process of making predictions about future events or trends based on current or historical data.