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Running head: SHORT ANSWER PROBLEM SET 1 Module 04 Written Assignment – Short Answer Problem Set Jeremy Wheeler Rasmussen College Author Note This paper is being submitted on December 03, 2017, for Tiffany Krogman’s A276/ACG2680 Section 02 Financial Investigation course.
SHORT ANSWER PROBLEM SET 2 Module 04 Written Assignment – Short Answer Problem Set Overstatement of Reserve & Goodwill When a company is acquired, the accumulated depreciation is added to the acquiring company's balance sheet and offset by the acquiring company's reserves. If the reserves are overstated, something in the acquiring company's asset accounts needs to be increased in order to offset the additional reserves. Of the available asset accounts, only the Goodwill account, an intangible asset, can be modified without some sort of required accountability. Gross Margin Increase “Sudden, significant increases in gross margin as a percentage of sales are indications of possible overstatement of inventory and understatement of COGS.” (Jackson, 2015, p.179) It is not a guarantee of fraud, however, because there are some logical reasons for the increase. Those reasons should be noted in the Management Discussion and Analysis section of the annual report so that the increase is not suspect. (Jackson, 2015, p.179) Lifestyle Changes

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