Which of the Following Is a Common Example of Vendor

question 37

Multiple Choice

Which of the following is a common example of vendor fraud?

• A) Fraud perpetrated through collusion between buyers and vendors.
• B) Fraud perpetrated by upper management.
• C) The perpetrator physically removes the inventory from the business premises.
• D) A fraud perpetrated through financial statement manipulation.

---

Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material and labor costs.

Inventory Cost Flow Assumption

An accounting assumption that determines how the cost of inventory is allocated to the cost of goods sold and ending inventory.

Cost of Goods Available

The total cost of goods that are available for sale during a certain period, including goods purchased or manufactured.

Periodic System of Inventory

An inventory system that updates inventory balances at the end of a certain period, involving periodic physical counts.