The controller changed the journal entry for estim...

Question Number 35

The controller changed the journal entry for estimating bad debt expense to a smaller number to hide the poor results from extending credit to high risk customers. This made income materially higher than it otherwise would have been.

1) Management fraud

2) Embezzlement or defalcation

3) White-collar crime

4) Larceny

5) Errors

✔ Correct Answer:

1) Management fraud

Auditing Practice Questions Test 1 (Chapters 1-4) Test

Question Number 35

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