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This question tests your ability to perceive the place(s) where potential problems may exist and the type of problem (overstatement or understatement) that may

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This question tests your ability to perceive the place(s) where potential problems may exist and the type of problem (overstatement or understatement) that may exist. Required: For each of the items below, identify the account(s) that need(s) to be audited carefully and the reason; for example, "potential overstatement or understatement of A) Current year inventory is larger than last year but the current year gross margin (profit) is larger. B) Current year fixed assets total is larger than last year but current amortization expense is the same as last year.

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