You are completing analytical procedures (ratios) for the audit of sales and accounts receivable. Identify 3 ratios
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Question:
- You are completing analytical procedures (ratios) for the audit of sales and accounts receivable. Identify 3 ratios and their trend (increased/decreased) which may indicate that net sales and/or net accounts receivable may be overstated. Explain.
Item | Ratio | Increased/decreased - Explain |
1 | ||
2 | ||
3 |
- What are the effects of overstating ending inventory on Cost of Sales, and Profit (understate/overstate)? Explain.
Effect on Cost of Sales |
Effect on Profit |
Related Book For
Auditing and Assurance services an integrated approach
ISBN: 978-0132575959
14th Edition
Authors: Alvin a. arens, Randal j. elder, Mark s. Beasley
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