1. From a quantitative sense the auditor would consider overall materiality to be $90,000. Further assume that the company has existing debt covenants of a current ratio of 2.0 or higher; and, Working capital limit of $205,000 or higher. If either covenant is violated, then the debt could be called immediately, resulting in the companys bankruptcy. Reported current assets are $420,000 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. $ 90,000 b. 20,000 c. 15,000 d. 10,000 e. None of the above. The answer is ____

2. Referring to the All or nothing game discussed in class: The auditor assigns a Tolerable Misstatement of $5,000 to an account with $16,000 of unknown errors. How much unknown error will be found during the audit? a. 0 b. 5,000 c. 11,000; or 16,000 5,000 d. 16,000 e. None of the above. The answer is ____