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testipw testipw
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4 months ago
An important balance-related audit objective is realizable value. Describe the purpose of this audit objective, what it is concerned with, and give an example.
Textbook 

Auditing and Assurance Services


Edition: 17th
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ttoe81ttoe81
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The purpose of this audit objective is to make sure that assets are included on the balance sheet at the amounts estimated to be realized.

It is concerned with whether an account balance has been reduced for declines from historical cost or when accounting standards require a fair value accounting treatment for the account. It is concerned with valuation and allocation. It generally applies only to asset accounts, although some liabilities are recorded at fair value.

Examples include the allowance for uncollectible accounts, and write-downs of inventory for obsolescence.

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testipw Author
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4 months ago
Thank you, thank you, thank you!
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Correct Slight Smile TY
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2 hours ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
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