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In considering materiality for planning purposes, an auditor believes that misstatements aggregating $10,000 will have a material effect on an entity's income statement, but that misstatements will have to aggregate $20,000 to materially affect the balance sheet. Ordinarily, it is appropriate to design audit procedures that are expected to detect misstatements that aggregate $10,000, $15,000, $20,000 or $30,000 and please explain why.

Respuesta :

Answer:

correct option is $10,000

Explanation:

correct option is $10,000

It implies the auditor concludes that the $10,000 value has a significant impact on the report of income plus has a cumulative impact on the income statement with a $20,000 amount. The auditor will, therefore, set $10,000 as a material item to subtract the errors. Additionally, the total sums of $15,000, $20,000, $30,000 to develop the audit procedures aren't really sufficient.

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