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NEW QUESTION: 1
An auditor discovered that a client's accounts receivable turnover is substantially lower for the current year
than for the prior year. This may indicate that:
A. Fictitious credit sales have been recorded during the year.
B. An employee has been lapping receivables in both years.
C. The client recently tightened its credit-granting policies.
D. Employees have stolen inventory just before the year-end.
Answer: A
Explanation:
Explanation/Reference:
Explanation:
Choice "A" is correct. Recording fictitious sales generally has the same impact on revenues and
receivables: both would be overstated by the same dollar amount. However, this will cause the accounts
receivable turnover ratio to decrease, because the sales figure for the year is generally much larger than
the average receivables amount. Since the numerator (sales) is being increased far less proportionately
than is the denominator (receivables), overall the ratio will decline. (Try using actual numbers if you want to
see how this works: Assume sales of $2,000,000 and average receivables of $300,000. What will happen
to the ratio if you increase both of these numbers by $50,000? It will go from 6.7% to 5.9%--a decline.)
Choice "B" is incorrect. Inventory stolen by employees just before year-end would not affect the accounts
receivable turnover ratio, which is calculated as net credit sales divided by average gross receivables.
Choice "C" is incorrect. A substantially lower accounts receivable turnover ratio may indicate collectability
issues. This might be the result of the client loosening (not tightening) its credit-granting policies.
Choice "D" is incorrect. If an employee has been lapping receivables in both years, the accounts
receivable turnover ratio would not be substantially lower in one year compared to the other.

NEW QUESTION: 2
Refer to the exhibit.

According to the output of the debug voip ccapi inout command, why was this call dropped?
A. Normal call clearing
B. No circuit
C. User busy
D. Call rejected
E. No resource
F. Invalid number
Answer: A

NEW QUESTION: 3
The cost of qualified Coating Inspection is normally offset by:
A. Lower Application Costs
B. Lower Coating Life Cycle Costs
C. Lower Supervision Costs
D. Lower Safety Enforcement Costs
Answer: B