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Auditing & Assurance Services 6th Edition by Timothy Louwers
Edition 6ISBN: 978-0077862343Auditing & Assurance Services 6th Edition by Timothy Louwers
Edition 6ISBN: 978-0077862343 Exercise 22
Auditors sometimes use comparisons of ratios as audit evidence. An unexplained decrease in the ratio of gross profit to sales may suggest which of the following possibilities?
A) Unrecorded purchases.
B) Unrecorded sales.
C) Merchandise purchases being charged to selling and general expense.
D) Fictitious sales.
A) Unrecorded purchases.
B) Unrecorded sales.
C) Merchandise purchases being charged to selling and general expense.
D) Fictitious sales.
Explanation
Verified
Verified
Gross profit ratio is the relationship b...
Auditing & Assurance Services 6th Edition by Timothy Louwers
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