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The 3,000 accounts receivable of DEF Company have a total book value of $60,000. Bob Smith,...

The 3,000 accounts receivable of DEF Company have a total book value of $60,000. Bob Smith, CPA, has selected and audited a sample of 100 accounts with a total book value of $2,100. Smith has properly estimated a projected misstatement of an overstatement of $6,000 for the entire population. The audited value of the accounts receivable is:

$1,700
$54,000
$1,800
$58,000
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Answer #1

Correct answer is: $54000

Total book value of accounts receivables = $60000

Projected misstatement (Overstatement) = $6000

Audited value of accounts receivables = $60000 - $6000 = $54000

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