Quiz ii review questions

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AC574 – Quiz 2 Review Questions: IMPORTANT: Please review the following questions before taking the weekly quiz. 19. (TCO B) A company has a 22% profit margin and has employee fraud of $220,000. Calculate the additional revenue needed to offset this lost income. A. $540,000. B. $720,000. C. $820,000. D. $1,000,000. E. Some other amount. 20. (TCO B) You are told that a company has a 20% profit margin and the discovered fraud has caused $1,400,000 more needed revenue to cover the fraud. How much was stolen? A. $280,000. B. $560,000. C. $1,400,000. D. $7,000,000. E. Some other amount. 21. (TCO B) You are told that a company has a 30% profit margin and the discovered fraud has caused $2,400,000 more needed revenue to cover the fraud. How much was stolen? A. $340,000. B. $720,000. C. $2,400,000. D. $8,000,000. E. Some other amount. 24. (TCO B) Which would not be a direct IRS method for reconstructing taxable income? A. Newspaper articles. B. Checking deed records of real estate transactions. C. Discussions with third parties. D. Checking public records. E. All of the above are direct methods. 25. (TCO B) Which of the following is an example of a reactive approach to fraud detection?
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