For Most Audits, Inherent Risk for Accounts Receivable Is Moderate

question 59

Multiple Choice

For most audits, inherent risk for accounts receivable is moderate or low except for which balance-related audit objectives?

• A) Timing and realizable value.
• B) Completeness and existence.
• C) Existence and accuracy.
• D) Realizable value and cutoff.

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Definitions:

Disposable Income

The sum of money households can spend or save after deducting income taxes.

Capital Expenditure

Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment, intended to improve long-term performance.

Allocating Resources

The process of distributing available resources, such as time, money, and manpower, among various projects or business units to achieve strategic goals.

Rolling Budget

A continuously updated budget that extends a set period into the future by adding a new period as the most recent period is completed.