Which of the Following Would NOT Be a Red Flag

question 39

Multiple Choice

Which of the following would NOT be a red flag in a financial statement analysis?

• A) Short number of days' in accounts receivable
• B) Decreased cash flow
• C) High debt ratio
• D) Low inventory turnover
• E) Earning problems

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Definitions:

Box Plots

A graphical representation of the distribution of data based on a five-number summary: minimum, first quartile, median, third quartile, and maximum.

Outliers

Outliers are data points that differ significantly from other observations, potentially indicating a measurement variation or error.

Symmetrical

A characteristic of a shape or distribution where one half is a mirror image of the other half, usually about a central point or axis.

Unimodal Distribution

A type of distribution that has a single peak or mode, showing one predominant frequency of data points.