Which of the Following Statements Concerning Accounting Risk (AccR)is FALSE

question 36

Multiple Choice

Which of the following statements concerning accounting risk (AccR) is FALSE?

• A)Estimation of AccR requires knowledge of the auditee's business and industry.
• B)AccR is largely dependent on factors outside the control of both the auditor and auditee.
• C)AccR can best be estimated using the uniform distribution assumption to calculate the reasonable range.
• D)AccR and Audit Risk (AuR)are largely dependent on one another.

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Definitions:

Rent Control

Government-enforced laws that limit the rent landlords can charge for apartments, aiming to keep housing affordable for renters.

Price Ceilings

A legal maximum price that can be charged for a good or service, intended to protect consumers from prices that are deemed excessively high.

Equilibrium Price

Equilibrium Price is the market price at which the quantity of goods supplied equals the quantity of goods demanded.

Shortage

A scenario in which the need for a product or service surpasses the amount available at a particular price.