The Audit of Owners' Equity of Public and Private Companies

question 22

Multiple Choice

The audit of owners' equity of public and private companies is very different.Which of the following is not one of these differences?

• A)The number of transactions (private companies have fewer transactions)
• B)Payment of dividends (public companies rarely pay dividends)
• C)Complexity of transactions (public companies generally have more complex transactions)
• D)Type of noncurrent debt (public companies issue more bonds)

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Definitions:

Description of Goods

A detailed account or specification of the physical and sometimes functional characteristics of goods in a contract for sale.

Implied Warranty

A warranty that the law derives by implication or inference from the nature of the transaction or the relative situation or circumstances of the parties.

Warranty of Merchantability

An implied guarantee that a product will meet the standard quality and performance expectations for goods of its kind.

Garage Sale

An informal, often temporary sale of used goods by private individuals, typically held at the seller's residence.