When evaluating the audit findings, the auditor should be satisfied that the
A) amount of known misstatement is documented in the management representation letter.
B) estimate of the total known and likely misstatements is less than a material amount.
C) estimate of the total likely misstatement includes sample error.
D) amount of known misstatement is acknowledged and recorded by the client.
B
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Which of the following statements regarding methods to record investments after acquisitions is incorrect?
a) it is not relevent to the consolidated FS whether the parent company measures its investment account using the cost method or using one of the equity methods so long as the eliminating entries are properly prepared b) initial recording of the investment (At its cost) is identical in all three methods, i.e., cost, partial equity, or complete equity method c) under the equity method, the investor adjusts the investment account upward for its share of the investee's earnings and dividends declared d) for periods subsequent to acquisition, both the investment account and the equity in subsidiary income will be larger under the partial equity method than under the complete equity method if the subsidiary carries depreciable assets with market values greater than book values
The manufacturing cycle occurs at the
A) customer/retailer interface. B) retailer/distributor interface. C) distributor/manufacturer interface. D) manufacturer/supplier interface.