Question

Indicate whether confirmation of accounts receivable and accounts payable, provided they each are significant accounts, is required or optional.

A) Accounts Receivable Accounts Payable
Required Required
B) Accounts Receivable Accounts Payable
Required Optional
C) Accounts Receivable Accounts Payable
Optional Required
D) Accounts Receivable Accounts Payable
Optional Optional

Answer 1

Confirmation of accounts receivable is optional, while confirmation of accounts payable is required.

Step-by-step explanation:

The correct answer to the question is option C) Accounts Receivable: Optional, Accounts Payable: Required.

Confirmation of accounts receivable means verifying the balances owed to a company by its customers. This is optional because some companies may not have a significant accounts receivable balance or may have other methods of ensuring the accuracy of their accounts receivable.

Confirmation of accounts payable involves confirming the amounts owed by a company to its vendors or suppliers. This is required because accounts payable represent an important liability for the company and confirmations help ensure that these amounts are accurate.