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Give Some Examples of How a Manufacturing Company Can Manipulate

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Give some examples of how a manufacturing company can manipulate earnings by including non-production costs in inventories. What does an auditor or financial statement user do to detect this type of manipulation?


Definitions:

Art of Reasoning

The skillful use of thinking and logic to form conclusions, solve problems, and engage in persuasive discourse.

Thomas Jefferson

An American Founding Father, the principal author of the Declaration of Independence, and the third President of the United States.

Circumstances

The conditions or facts affecting a situation, event, or action.

Own Choices

Decisions made independently by an individual, based on personal preference or judgment.

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