When evaluating the financial data of a 10-year-old business that is being considered for purchase,which issue will be of least concern?
A)Understated income in an effort to minimize taxes
B)Unrealistically reduced levels of advertising cost
C)Business expenses related to personal use of vehicles
D)Not having the books for Years 1-5 due to a fire

Question

Quizplus · Accepted Answer

Not having the books for Years 1-5 due to a fire is an unfortunate circumstance, but it is not an issue that is directly related to the financial data of the business over the past ten years. However, understated income, unrealistically reduced levels of advertising cost, and business expenses related to personal use of vehicles could all impact the accuracy of the financial data and should be thoroughly evaluated.

When Evaluating the Financial Data of a 10-Year-Old Business That