Imagine that the auditor of QRS has expressed concerns that the bad debts expense recorded for the year is not high enough. What would be the impact on the reported value of the following items if the auditor requires an adjustment to be made? Select higher, lower or no effect from the drop down menu.

Indicate higher/lower/no effect for:

Cash

Accounts Receivable

Allowance for Doubtful Debts

Bad debts expense

Current Assets

Net Profit