Accounting 9706 · AS & A Level · Analysis and communication of accounting information

Analysis and communication of accounting information — practice question

A figure in a company’s financial statements is discovered to contain an error that is material. What does ‘material’ mean?

  • AThe item affects only the statement of profit or loss of the company.
  • BThe item affects only the statement of financial position of the company.
  • CThe item has a small monetary value.
  • DThe item may affect the economic decisions of a user of the financial statements.

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