Chapter 5 Homework

Chapter 5 Homework - Chapter 5-Employee Fraud: The...

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Chapter 5—Employee Fraud: The Misappropriation of Assets 1.  Define misappropriation of asset.  What are other terms for this concept? Misappropriation of assets involves the theft of an entity’s assets by stealing, embezzling,  misuse of company assets, and causing a company to pay for goods or services that have  not been received.  Referred to as theft or defalcation. 6.  Multiplier, Inc. has a 25 percent gross profit margin during a year when there is a skimming  scheme which reduces the bottom-line by $1,200,000.  What increase in revenue is needed to  replace this bottom-line loss? $1,200,000 x 5 = $6,000,000 13.  If there is a substantial increase in bad debts, what might this mean? 21.  What is meant by “washing checks?” Check washing is the process of erasing detail from checks to allow them to be rewritten,  usually for criminal purposes such as fraudulent withdrawal from the victim’s bank 
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This note was uploaded on 03/20/2012 for the course ACCT 201 taught by Professor Inga during the Spring '12 term at VCU.

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Chapter 5 Homework - Chapter 5-Employee Fraud: The...

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