Difference between revisions of "Pop Quiz Materiality"
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| − | : '''Answer''': ''Company B''. | + | : '''Answer''': ''Company B'' would have a <u>lower</u> materiality level. |
:* It's at a much earlier stage in its organizational life cycle. | :* It's at a much earlier stage in its organizational life cycle. | ||
:* Therefore its <u>net income</u> is likely much lower so smaller swings in net income would have a proportionately greater impact on decision-making ''(versus Company A.)'' | :* Therefore its <u>net income</u> is likely much lower so smaller swings in net income would have a proportionately greater impact on decision-making ''(versus Company A.)'' | ||
Revision as of 17:51, 12 March 2019
- Answer: Company B would have a lower materiality level.
- It's at a much earlier stage in its organizational life cycle.
- Therefore its net income is likely much lower so smaller swings in net income would have a proportionately greater impact on decision-making (versus Company A.)
