Which of the Following Is Not One of the Three

question 30

Multiple Choice

Which of the following is not one of the three categories of assertions?

• A)Assertions about classes of transactions and events for the period under audit
• B)Assertions about financial statements and correspondence to GAAP
• C)Assertions about account balances at period end
• D)Assertions about presentation and disclosure

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Definitions:

Risk Free Asset

An investment that is expected to return its original value without any loss and with a certain rate of interest; considered to have zero default risk.

Rate of Return

The increase or decrease in the value of an investment during a set time frame, represented as a proportion of the investment's original price.

Level of Risk

The degree of uncertainty associated with an investment or decision, often regarding the potential for loss.

Optimal Portfolio

An investment strategy that maximizes expected return for a given level of risk through diversification.