The following situations represent errors and frauds that could occur in financial statements. Required: State how the ratio in question would compare (higher, equal, or lower) to what the ratio should have been had the error or fraud not occurred. The company recorded fictitious sales with credits to sales revenue accounts and debits to accounts receivable. Inventory was reduced, and cost of goods sold was increased for the profitable "sales." Is the current ratio higher than, equal to, or lower than what it should have been? The company recorded cash disbursements by paying trade accounts payable but held the checks past the year-end date, meaning that the "disbursements" should not have been shown as credits to cash and debits to accounts payable. Is the current ratio higher than, equal to, or lower than what it should have been? Consider cases in which the current ratio before the improper "disbursement" recording was (1) higher than 1:1, (2) equal to 1:1, and (3) lower than 1:1. Toolbar navigation opens in a dialog The company uses a periodic inventory system for determining the balance-sheet amount of inventory at year-end. Very near the year-end, merchandise was received, placed in the stockroom, and counted, but