Explain how your knowledge of the business and industry would impact your audit of total revenues and accounts receivable for the client.

AP11.2 (LO 2) An icon reads, Moderate. Analytical procedures the following data were taken from the production and accounting records for Casuccio Manufacturing, Inc.

Unaudited 2026 Audited 2025 Audited 2024

Operating Data

Capacity in units 450,000 450,000 450,000

Production in units 450,000 400,000 300,000

Inventory in units 32,000 28,000 21,000

Financial Data ($000)

Total revenues $35,200 $27,500 $21,200

Total assets 23,000 19,500 15,700

Accounts receivable, net 5,900 4,300 3,900

Bad debt expense 175 135 105

Accounts receivable written off 165 125 100

Required

Calculate the following ratios for 2026, 2025, and 2024.

Sales to total assets.

Sales to production.

Revenue per unit sold.

Accounts receivable growth to sales growth.

Uncollectible accounts expense to net credit sales.

Uncollectible accounts expense to accounts receivable written off.

Accounts receivable turnover in days.

Describe the implications of the resulting ratios for the auditor's audit strategy for 2026.

What specific assertions are likely to be misstated?

How should the auditor respond in terms of potential audit tests?