As a rule of thumb which of the following items would be considered immaterial?
A)An item greater than 10 per cent of profit before tax.
B)An item greater than 1 per cent of total assets.
C)An item greater than 2 per cent of equity.
D)None of the above.

Question

Quizplus · Accepted Answer

Materiality is a concept that depends on the context and size of the entity, and there are no fixed thresholds such as those mentioned in options A, B, and C that apply universally. What is considered material can vary significantly from one entity to another based on factors like the nature of the business, the size of the company, and specific circumstances. Therefore, none of the options provided can be universally applied as a rule of thumb for determining materiality.

As a Rule of Thumb Which of the Following Items