Requirement b$.$ Which specific aspects of the$$ client's financial statements require intensive investigation in this$$ audit?

As the$$ auditor, you

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accept

Ackers'Ackers'

explanation if the decline is material. The decline in gross margin could be due to

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a combination of overstatement of drug inventory and sales.

a decrease in the cost of drugs.

an increase in the selling price of the drugs.

an understatement of drug inventory, a theft of drug inventory, or understated sales.

Further investigation

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is not necessary since the additional analytical procedures confirmed Ackers's explanation.

is required to determine if the decline is due to competitive factors or to a misstatement of income.