Which of the Following Is NOT a Symptom of Liability

question 9

Multiple Choice

Which of the following is NOT a symptom of liability fraud?

• A)A sudden decrease in accounts payable/inventory ratio.
• B)Inappropriately capitalizing costs that should be expensed.
• C)An unusual increase in current ratio.
• D)Record payments made in later periods as being paid in earlier periods.

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Definitions:

Job Costing

An accounting method used to track costs and revenues by job or project, typically applied in industries that produce unique products or offer services tailored to specific customer requirements.

Factory Overhead Rate

is a calculation used to allocate the indirect costs of manufacturing to individual units produced, typically based on direct labor hours or machine hours.

Direct Materials

Raw materials that are directly traceable to the production of a specific finished good.

Direct Labor Rate

The cost per hour for labor directly involved in producing goods or delivering services, typically used in calculating the total cost of production or service provision.