When Confirming Receivables in Testing for Overstatements,there Are Few or No

question 25

Multiple Choice

When confirming receivables in testing for overstatements,there are few or no misstatements expected,and the selection is based on dollars,the auditor is likely to use

• A)MUS sampling.
• B)stratified mean-per-unit sampling.
• C)ratio estimation sampling.
• D)attribute sampling.

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Definitions:

Required Rate

The minimum rate of return that an investment or project must offer to be considered viable or attractive.

Operating Assets

Assets used in the daily operations of a business to generate revenue, such as plant, equipment, inventory, and receivables.

Residual Income

The income that an entity generates after accounting for the cost of capital, showing what is effectively left over for shareholders.

Centralized Organizations

Organizations where decision-making authority is concentrated at the top levels of management, with lower levels primarily responsible for implementing decisions.