Which Is Not a Symptom of Liability Fraud

question 17

Multiple Choice

Which is not a symptom of liability fraud?

• A) Decrease in warranty expense estimate
• B) Accounts payable grow faster than cost of goods sold & inventory
• C) Unusual increase in current ratio
• D) Decrease in accruals & unearned revenue from prior periods

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Definitions:

Bushel

A unit of volume that is used in the United States for trading and pricing agricultural commodities like corn, wheat, and soybeans.

S&P 500 Index

A stock market index that measures the stock performance of 500 of the largest companies listed on stock exchanges in the United States.

Arbitrage Profit

Earnings realized from buying and selling the same asset in different markets to take advantage of differing prices for the same asset.