Lara,an Accountant,conducts an Audit of Microstuff,Inc

question 8

Multiple Choice

Lara,an accountant,conducts an audit of Microstuff,Inc.After the con?clu?sion of the audit,the working papers created in preparing the audit must be

• A)disposed of immediately.
• B)kept until the Public Company Accounting Oversight Board's review.
• C)maintained for seven years.
• D)retained forever.

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Definitions:

Acid-test Ratio

A liquidity measure that evaluates a company's ability to pay its short-term liabilities with its most liquid assets, excluding inventory.

Current Ratio

This ratio assesses the capability of a firm to cover debts due within the next year by dividing its current assets by its current liabilities.

Year-end Information

Data or records summarizing the financial activities and status of an organization at the end of a fiscal year.

Acid-test Ratio

A financial metric that assesses a company's ability to pay its current liabilities with its most liquid assets.