Please write true or false for each number.

1) One of the main elements of the fraud triangle is rationalization.

2) One of the most common types of fraud that impacts the financial statements is the

misappropriation of assets.

3) Fraudulent financial reporting is committed by company managers.

4) A budget is a financial plan that helps coordinate business activities.

5) The bank reconciliation can be used to control cash.

6) There are two records of a business's cash-the cash account in the company's general ledger and

the bank statement.

7) An unrealized loss occurs when the current market value is more than the original cost of the

investment.

8) The amount of revenue to be recognized is the cash value of the goods or services transferred

from the seller to the buyer.

9) If the credit terms are 2/10, n/30, the buyer can get a 2% discount if the invoice is paid within 30

days.

10) Sales discounts and sales returns and allowances are deducted from gross revenue to determine

net revenue.

11) Inventory is an asset and cost of goods sold is an expense.

12) The cost of any plant asset is the sum of all of the costs incurred to bring the asset to its intended

use.

13) In the units-of production method, a fixed amount of depreciation is assigned to each unit of

output.

14) The straight-line method must be used for computing depreciation for income tax purposes.