Which of the Following Actions Is Not a Potential Fraud

question 18

Multiple Choice

Which of the following actions is not a potential fraud scheme related to long-lived assets?

• A)Impairment losses on long-lived assets are not recognized.
• B)Costs that should have been expenses are improperly capitalized.
• C)Amortization of intangible assets is miscalculated.
• D)All the above are potential fraud schemes.

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Definitions:

Gross Method

An accounting approach for recording purchases or sales of inventory where discounts are not taken into account until they are actually realized.

Forward Contract

An individualized contract between two counterparts to acquire or dispose of an asset at a fixed price on a specified future date.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) aimed at making global financial statements more comparable.

Hedge Transactions

A financial strategy used to minimize the risk of adverse price movements in an asset, often involving derivatives like futures or options contracts.