Question: Whitehall Company records its liabilities in an accounts payable subsidiary
Whitehall Company records its liabilities in an accounts payable subsidiary ledger. The auditors have decided to select some of the accounts for confirmation by direct communication with vendors. The largest volume of purchases during the year has been made from Ranchero Company, but at the balance sheet date this account has a zero balance. Under these circumstances, should the auditors send a confirmation request to Ranchero Company, or would they accomplish more by limiting their confirmation program to accounts with larger year-end balances?
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