Analytical symptoms for unrecorded notes and mortgages payable include which of the following?
A) Significant increases in recorded debt
B) Unreasonable relationships between interest expense and recorded liabilities
C) Recorded amounts of notes payable, mortgages payable, and other debts that appear to be too high
D) Significant sales of assets with not much cash flow

Question

Quizplus · Accepted Answer

Unreasonable relationships between interest expense and recorded liabilities can indicate that there are unrecorded notes and mortgages payable because the interest expense recognized does not match up with the amount of debt recorded on the balance sheet. This discrepancy can suggest that there are liabilities not being accounted for.

Analytical Symptoms for Unrecorded Notes and Mortgages Payable Include Which