In Which of the Following Circumstances Is the Use of the Negative

question 51

Multiple Choice

In which of the following circumstances is the use of the negative form of accounts receivable confirmation most likely to be justified?

• A)A substantial number of accounts may be in dispute and the accounts receivable balance arises from sales to a few major customers.
• B)A substantial number of accounts may be in dispute and the accounts receivable balance arises from sales to many customers with small balances.
• C)A small number of accounts may be in dispute and the accounts receivable balance arises from sales to a few major customers.
• D)A small number of accounts may be in dispute and the accounts receivable balance arises from sales to many customers with small balances.

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Definitions:

Deferred Annuity

An insurance product that delays income payments until the investor elects to receive them, which can be many years after the initial investment.

Ordinary Annuity

A series of equal payments made at regular intervals, with the interest compounded at the end of each period.

Compounded Semi-annually

Interest calculation method where interest is added to the principal twice a year, increasing the amount on which future interest is calculated.

Bequest

A transfer of personal property or assets to a beneficiary as dictated by the will of the deceased.