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Which type of set of financial statements is least likely to fairly represent a companys financial position:

Audited financials

Reviewed financials

Compiled Financials

Cash received by a company prior to its delivery of goods to a customer is MOST LIKELY recorded when received as:

Deferred revenue, an asset

Deferred revenue, a liability

Sales, an income statement item

If a company records fictitious income, it most likely would try to cover up its fraud by:

Decreasing assets

Increasing expenses

Increasing liabilities

Creating one or more fictitious asset

Which of the following elements of financial statements is most closely related to the measurement of a companys financial position?

Income

Expenses

Equity

Assuming total asset turnover is revenue divided by average total assets, impairment write downs of a companys long-lived assets will MOST LIKELY result in an increase in the companys:

Debt to equity ratio

Total asset turnover

Both total asset turnover and debt to equity ratio

A conversion of a face value $1 million convertible bond for $1 million of common stock would MOST LIKELY be:

Reported as a $1 million financing inflow

Reported as a $1 million financing outflow

Reported as a $1 million investing inflow

Reported as a $1 million investing outflow

Reported as a footnote to the financial statements

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