The Auditor Can Assign a Portion of the Materiality to Individual

question 58

Multiple Choice

The auditor can assign a portion of the materiality to individual accounts in the financial statements

• A)This is referred to as the auditor using professional judgment
• B)This is referred to determining materiality for particular items on the financial statements
• C)This is referred to as the tolerable misstatement or performance materiality for an account
• D)This is referred to as the auditor obtaining reasonable assurance

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Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Demand Increases

A situation where the quantity of a product or service desired by buyers exceeds the quantity supplied at a particular price.

Supply Decreases

A condition in the market where the quantity of a product or service available for sale declines, which can lead to higher prices.

Quantity Supplied

is the amount of a good or service that producers are willing and able to sell at a given price over a specified period of time.