The Client May Use a Variety of Methods to Understate

question 85

Multiple Choice

The client may use a variety of methods to understate liabilities,interest expense and long-term debt.These include

• A)Recording operating leases as capital leases to avoid putting the liability on the balance sheet.
• B)Failing to disclose long-term agreements.
• C)Failing to disclose special debt arrangements,such as transactions with special purpose entities in an attempt to keep debt arrangements off the books.
• D)Failing to disclose related-party transactions.Debt associated with related-parties may carry a higher risk than debt associated with non-related parties.
• E)both A and B
• F)both B and E
• G)both C and D

---

Definitions:

Web Address

The unique identifier for a website or a web page on the internet, also known as URL (Uniform Resource Locator).

Short-Term Memory

A component of memory where small amounts of information can be kept for a short period of time.

Frequent Contacts File

A collection or record of individuals or entities that are contacted or interacted with regularly, often used for quick reference.

Echoic Memory

A component of sensory memory that retains audio information, allowing brief recall of sounds recently heard.