The following questions deal with materiality. Choose the best response. Which one of the following statements is correct concerning the concept of materiality? (1) Materiality is determined by reference to guidelines established by the AICPA. (2) Materiality depends only on the peso amount of an item relative to other items in the financial statements. a. (3) Materiality depends on the nature of an item rather than peso amount. (4) Materiality is a matter of professional judgment.

The following questions deal with materiality. Choose the best response. Which one of the following statements is correct concerning the concept of materiality? (1) Materiality is determined by reference to guidelines established by the AICPA. (2) Materiality depends only on the peso amount of an item relative to other items in the financial statements. a. (3) Materiality depends on the nature of an item rather than peso amount. (4) Materiality is a matter of professional judgment.

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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With respect to the concept of materiality, which of the following statements is correct?a. Materiality depends only on the dollar amount of an item relative to other items in the financial statements.b. Materiality depends on the nature of a transaction rather than the dollar amount of the transaction.c. Materiality is determined by reference to AICPA guidelines.d. Materiality is a matter of professional judgment.
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