Which of the Following Conditions Is the Strongest Indicator of Possible

question 62

Multiple Choice

Which of the following conditions is the strongest indicator of possible fraud?

• A) An assistant treasurer who refuses to take vacations.
• B) Independent reconciliations of subsidiary to general ledgers that are not always completed on a timely basis.
• C) A condition of excess manufacturing waste material.
• D) A manager who is often over budget at the end of a reporting period.

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Definitions:

Semi-Annual Coupon

Describes the interest payment made to bondholders every six months until the bond's maturity date.

Yield To Maturity

The total return anticipated on a bond if it is held until its maturity date, accounting for interest payments and the repayment of the principal.

Market Price

The current cost for engaging in transactions involving assets or services.

Zero-Coupon Bond

A type of bond that does not pay periodic interest but is issued at a discount to its face value and matures at face value.