To Gather Evidence About Transactions with Related Parties,an Auditor Would

question 31

Multiple Choice

To gather evidence about transactions with related parties,an auditor would most likely ________.

• A)send account confirmations
• B)perform analysis of receivables turnover
• C)scan the receivables sub-ledger for credit balances
• D)scan the aged trial balance for names of officers and directors

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Definitions:

Cash Dividend

A share of a company's profits paid out to its shareholders in cash.

Stock Dividend

A dividend payment made in the form of additional shares rather than a cash payout, increasing the total number of shares owned by shareholders.

Shares Outstanding

The total number of shares of stock that have been issued and are currently owned by shareholders.

Book Value

The value of an asset as recorded on the balance sheet, calculated as the cost of the asset minus any depreciation.