Assume that from a quantitative sense the auditor would consider

overall materiality to be one percent of total assets or

$3,000,000. Further assume that the company has an existing

Debt covenant of a current ratio of 2.0 or higher. If the

covenant is violated, then the debt could be called immediately,

resulting in the companys bankruptcy. Reported current assets

are $430,000 while reported current liabilities are $200,000.

Current liabilities have been audited. The auditor is satisfied

with the number for current liabilities. Considering debt

covenants as a qualitative materiality factor as discussed in

class, the auditor would likely set materiality for current

assets at

a. $ 15,000

b. 25,000

c. 30,000

d. 3,000,000