Donna Sees a Large Variation in the Gross Margin Percentage

question 68

Multiple Choice

Donna sees a large variation in the gross margin percentage as a result of analytical procedures she performed.This means that

• A)Donna should perform more tests.
• B)the financial statements contain an error.
• C)Donna cannot rely on the company's internal controls.
• D)Donna should document this difference.

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Definitions:

Silver Future

A contract to buy or sell a specific amount of silver at a predetermined price at a specified time in the future, used as a financial instrument for speculation or hedging.

Spot Price

The current market price at which a particular asset, such as a commodity or currency, can be bought or sold for immediate delivery.

Profit

The profit achieved when the revenue from a business operation is greater than the expenses, costs, and taxes required for the operation.

Treasury Bond

Debt obligation of the federal government with original maturity between 10 and 30 years.