As Part of Audit Planning,you Have Calculated Gross Margin for the Last

question 30

Multiple Choice

As part of audit planning,you have calculated gross margin for the last five years and compared gross margin to industry averages.Your client's gross margin has increased by about 5% in the current year,while the industry gross average has declined.One possible cause of this increased gross margin is

• A)higher cost of goods sold.
• B)increased bad debt expenses.
• C)premature revenue recognition.
• D)fictitious expenses.

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Definitions:

Volcanic Rock

Rock formed from magma erupted from a volcano or solidified lava on the earth's surface.

Continent

One of the very large landmasses on Earth, generally identified by convention rather than any strict criteria, with seven commonly recognized: Africa, Antarctica, Asia, Europe, North America, Australia (Oceania), and South America.

Fortress Town

A type of town designed and built with defensive structures such as walls, ramparts, and moats, to protect its inhabitants from enemy attacks.

Jericho

One of the oldest inhabited cities in the world, located in the West Bank, known for its ancient fortifications and biblical significance.