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Which one of the following material events occurring subsequent to the balance sheet date would require an adjustment to the financial statements before they could be issued?
a) major purchase cft business that is expected to double the sales volume b) settlement of litigation in excess of the recorded liability — — jj c 11- sale of long-term debt or capital stock – “— d loss of a plant as a result of a flood
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7_7 1120 A-CC707 Onllne-Final Exarni-riath Questions
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a 6. Which of the following is an exception report that the auditor would generate using generalised audit software in order to test the accuracy, valuation and allocation assertion for accounts receivable?
a) Adding the accounts receivable ledger, and checking the total to the accounts receivable balance in the general ledgei. • .
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