Which one of the following statements is NOT correct?
A) Normally, the most important base used as the criterion for deciding materiality is total assets.
B) Qualitative factors as well as quantitative factors affect materiality.
C) Materiality is a relative rather than an absolute concept.
D) Given equal dollar amounts, fraud is usually considered more important than errors.

Question

Quizplus · Accepted Answer

While total assets may be one factor considered when determining materiality, it is not always the most important factor. Other factors, such as net income, can also be used. Therefore, the statement that total assets are "normally" the most important criterion is not correct.

Which One of the Following Statements Is NOT Correct