An auditor assesses the risk of material misstatement because it a. is relevant to the auditor's understanding of the control environment. b. provides assurance that the auditor's overall materiality levels are appropriate. c. indicates to the auditor where inherent risk may be the greatest. d. affects the level of detection risk that the auditor may accept.

Kirnon clinic uses client-visits as its measure of activity. during july, the clinic budgeted for 3,250 client-visits, but its actual level of activity was 3,160 client-visits. the clinic has provided the following data concerning the formulas to be used in its budgeting: fixed element per month variable element per client-visitrevenue - $ 39.10personnel expenses $ 35,100 $ 10.30medical supplies 1,100 7.10occupancy expenses 8,100 1.10administrative expenses 5,100 0.20total expenses $ 49,400 $ 18.70the activity variance for net operating income in july would be closest to: