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Question - Listed below are audit situations that may affect the audit of receivables and revenue.
a. The audit of a machinery manufacturing company that engages in bill and hold transactions.
b. The audit of a software company that engages in agreements with multiple performance obligations that involve a fixed fee for software, updates, and customer support.
c. The audit of a construction company that enters into long-term construction contracts.
d. The audit of a manufacturing company that uses complex sales agreements that allow product returns under certain circumstances.
e. The audit of a software company whose salespeople often modify the terms of sales contracts with various side agreements.
Required - For each circumstance, provide an explanation of its audit significance and any special audit procedures that would result.
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