1. Which of the following is not part of the fraud triangle?

A. Perceived opportunity

B. Rationalization

C. Realization

D. Perceived pressure

2.The factor that makes a person feel forced to steal money because of high medical bills is

A. perceived pressure.

B. perceived opportunity.

C. rationalization.

D. realization.

3. If a misstatement of inventory occurs, the net income for _______ periods will be misstated.

A. 2

B. 1

C. 0

D. 3

4. _______ occurs if a disgruntled employee convinces another to steal from the company.

A. A control activity

B. The control environment

C. Monitoring

D. Collusion

5. Goods available for sale are $350,000; beginning inventory is $24,000; ending inventory is $32,000; and cost of goods sold is $275,000. What is the inventory turnover?

A. 12.50

B. 9.82

C. 11.46

D. 8.59

6. If ending inventory in Period 1 is overstated, gross profit in Period 2 is

A. overstated.

B. understated.

C. the same as in Period1.

D. not affected.

7. Which of the following would probably not need to be disclosed in a footnote?

A. A material change in estimated shrinkage

B. A 10% increase in sales

C. Change of inventory methods

D. A change in depreciation method

8. A method of valuing inventory based on the average of units is called the

A. average cost method.

B. specific cost method.

C. FIFO method.

D. LIFO method.

9. When merchandise is sold under the perpetual system of inventory, the journal entry to record a sale of merchandise on account includes debiting _______ and crediting _______.

A. Accounts Receivable; Sales

B. Accounts Receivable; Cost of Goods Sold

C. Cost of Goods Sold; Sales

D. Accounts Receivable; Inventory

10. In the United States, GAAP's overriding principles of accounting are written by the

A. SEC.

B. IRS.

C. IASB.

D. FASB.