Which of the Following Ratios Is Relatively More Helpful in Highlighting

question 44

Multiple Choice

Which of the following ratios is relatively more helpful in highlighting revenue-related frauds?

• A) Working capital turnover ratio
• B) Earnings per share
• C) Asset turnover ratio
• D) Accounts receivable turnover

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Definitions:

Material Events

Significant events that are likely to influence financial decisions or valuations of investors and analysts, requiring prompt disclosure by the entity involved.

Legal Action

Involves seeking remedy or resolution through judicial processes, including lawsuits or litigation, typically to enforce or protect legal rights or settle disputes.

Valuation

The process of determining the present value of an asset or company based on earnings, assets, and other relevant factors.

AASB 110

The Australian Accounting Standards Board standard that provides the guidelines for the treatment of events after the reporting period, including their recognition and disclosure in financial statements.