Dodge, CPA, is examining the financial statements of a manufacturing company with a significant amount of trade accounts receivable. Dodge is satisfied that the accounts are properly summarized and classified and that allocations, reclassifications, and valuations are made in accordance with GAAP. Dodge is planning to use accounts-receivable confirmation requests to satisfy the third standard of field work as to trade accounts receivable.

Required:

a. Identify and describe the two forms of accounts-receivable confirmation requests and indicate what factors Dodge will consider in determining when to use each.

b. Assume Dodge has received a satisfactory response to the confirmation requests. Describe how Dodge could evaluate collectibility of the trade accounts receivable.