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Which part of the audit risk model these statements about "Apollo shoe" fall under (inherent risk or control risk) if they affect the risk of material misstatement, and what impact they have on detection risk. 4 4 5 6 1 Apollo operates in the competitive athletic and outdoor footwear industry. 2 Apollo advanced $1.25 million to Larry Lancaster's secretary. Apollo believes a major future market for their shoes is in galactic athletic 3 footwear, but advances in space travel must be made for this market to emerge. Apollo does not have adequate documentation supporting customer returns of product. Apollo has maintained a positive trend in net income over the past several years, and has a strategic emphasis on meeting profitability targets. Apollo has not allowed your firm to speak with the predecessor auditor about their withdrawal after last year's engagement. 7 Apollo has refinanced their short term line of credit into a long term note 8 Apollo incurred $50,000 of charges to repair damages from a "Nor'easter 9 Apollo installed a new computer system mid-year. 10 Apollo leases all their properties. Apollo requires a customer purchase order and credit approval in order to 11 process a sale to a wholesale customer. Apollo suspended all R&D activities as a cost savings measure, and the lab will 12 be converted into a gym for corporate executives. Apollo utilizes sales invoices and shipping documents are pre-numbered, but the 13 sequence is not checked for missing invoices. IR Factor CR Factor Why? Comments Impact on RMM Impact on DR

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