Assume that Rosanne Madden, CPA, is using 5% of net incomebefore taxes, current assets, or current liabilities as her major guidelines for evaluatingmateriality. What qualitative factors should she also consider in deciding whethermisstatements may be material?

Assume that Rosanne Madden, CPA, is using 5% of net incomebefore taxes, current assets, or current liabilities as her major guidelines for evaluatingmateriality. What qualitative factors should she also consider in deciding whethermisstatements may be material?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Assume that Rosanne Madden, CPA, is using 5% of net income
before taxes, current assets, or current liabilities as her major guidelines for evaluating
materiality. What qualitative factors should she also consider in deciding whether
misstatements may be material?

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