Question

From the list of assertions provided below, which six assertions about account balances would typically impact balance sheet accounts? Select the six assertions by selecting "X" in drop-down option.

List of assertions:

Classification

Cut-off

Understandability

Completeness

Existence

Occurrence

Rights and obligations

Valuation

Accuracy

Answer 1

Assertions impacting the Balance sheet

Classification: Proper classification of assets, liabilities, and equity has been made.

Completeness: Proper recording of assets, liabilities, and equity has been made, and also related disclosure have been included.

Existence: Existence of all assets, liabilities, and equity interest.

Rights and Obligations: All assets, liabilities, and equity presented in the balance sheet actually belong to the entity.

Valuation: All assets, liabilities, and equity are recorded at the correct amount and all adjustments relating to this are recorded.

Accuracy: All assets, liabilities, and equity presented in the balance sheet are accurate and based on proper valuation.