A method used by companies to fraudulently inflate revenues includes which of the following?
A)Use of hidden "side letters" giving the customer an irrevocable right to return the product.
B)Recording of fictitious sales.
C)Shipment of product not ordered by customers.
D)All of the above.

Question

Quizplus · Accepted Answer

All of the above methods are commonly used by companies to fraudulently inflate revenues. "Side letters" giving the customer an irrevocable right to return the product can be used to temporarily boost revenues while hiding the fact that the sale is not actually final. Recording of fictitious sales involves booking sales that have not actually taken place, which artificially inflates reported revenues. Shipment of product not ordered by customers (also known as "channel stuffing") involves sending excess inventory to distributors or retailers, regardless of whether or not they have actually ordered it, in order to boost reported sales numbers.

A Method Used by Companies to Fraudulently Inflate Revenues Includes