An Example of Fraud Would Be

question 39

Multiple Choice

An example of fraud would be:

• A)Issuing a purchase order without first securing bids.
• B)Buying raw materials from an affiliated company.
• C)Knowingly classifying a material noncurrent receivable as a current receivable.
• D)Forgetting to accrue salaries and wages payable.

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Definitions:

Accounting Equation

The foundational principle of double-entry bookkeeping, stating that Assets = Liabilities + Equity, reflecting a company's financial position.

Total Liabilities

The sum of all financial obligations or debts that a company owes to external parties.

Total Assets

The sum of all assets owned by a company, including current, fixed, intangible, and other long-term assets, measuring its overall resources.

Current Assets

Items that are likely to be cashed in, sold, or expended within the span of one year or the standard operational period of the business.