Tolerable misstatement is:
A)materiality allocated to an assertion.
B)materiality for the balance sheet as a whole.
C)materiality for the income statement as a whole.
D)materiality allocated to a specific account.

Question

Quizplus · Accepted Answer

Tolerable misstatement refers to the maximum amount of misstatement that auditors are willing to accept in a specific account without qualifying their opinion on the financial statements. Therefore, it is the materiality allocated to a specific account.

Tolerable Misstatement Is