Which of the following most likely would give the most assurance concerning the valuation assertion for accounts receivable?
A)Tracing amounts in the subsidiary ledger to details on shipping documents.
B)Comparing receivable turnover ratios to industry statistics for reasonableness.
C)Inquiring about receivables pledged under loan agreements.
D)Assessing the allowance for uncollectible accounts for reasonableness.

Question

Quizplus · Accepted Answer

Assessing the allowance for uncollectible accounts for reasonableness directly addresses the valuation assertion by evaluating whether the accounts receivable are recorded at amounts expected to be realized. This involves analyzing the adequacy of the allowance for doubtful accounts, which is a key factor in determining the net realizable value of the receivables.

Which of the Following Most Likely Would Give the Most