For Each of the Following Factors, Determine If the Given

question 55

Essay

For each of the following factors, determine if the given change or level of that factor would lead an analyst to believe that managers of a firm are more or less likely to engage in earnings manipulation:
$\begin{array}{|l|l|} \hline \text { } & \text {Earuings Maruipulation }\\\hline \text { } & \text { More likely/lesslikely } \\\hline \text { 1. DaysSales in Receivable Index increases } & \text { } \\ \hline\text { 2. Gross Margin index decreases below 1 } & \text { } \\\hline \text { 3. AssetQuality index increases } & \text { } \\\hline \text { 4. Depreciation index decreases to below 1 } & \text { } \\\hline \text { 5. Leverage Index increases} & \text { } \\\hline\end{array}$

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Definitions:

New Product

An item or service recently developed or introduced to the market, offering new value to consumers.

Breakthrough

Refers to a significant and sudden advance or discovery that opens up new possibilities in a field of study, technology, or industry.

Continuous

An ongoing, uninterrupted process, action, or flow that does not have a clear beginning or end.

Product

Any item or service that is created through a process and is offered to the market to satisfy a need or want.