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Perform a horizontal analysis of the data and describe potential red flags regarding the possible overstatement of sales. Year 1 Year 2 Year 3

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Perform a horizontal analysis of the data and describe potential red flags regarding the possible overstatement of sales. Year 1 Year 2 Year 3 Year 4 Year 5 Answer: Sales $200,000 $210,000 $220,000 $274,000 $413,000 COGS 150,000 165,000 164,000 132,000 120,000 Gross profit 50,000 45,000 56,000 142,000 293,000

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