Suppose you have passed the test to become a certified fraud examiner. You are working for an outside firm to help detect fraud for three different companies described below.

The following balance sheet is provided for Phoenix Company.

• Perform a horizontal analysis of the balance sheet in Excel and identify two items that appear to be unusual and could be possible symptoms of fraud. Explain your reasons why the two items could be potential fraud.

Balance Sheet	2016	2017	2018	2019
Cash	1000	1300	1500	1600
Accounts Receivable	250	475	700	1000
Inventory	600	725	875	1000
Notes Receivable	2000	1975	2075	2250
Total Assets	3850	4475	5150	5850
Accounts Payable	700	875	975	1125
Other Current Liabilities	200	325	375	450
Notes Payable	1200	1400	1500	1700
Total Liabilities	2100	2600	2850	3275
Stock Outstanding	1000	1000	1000	1000
Retained Earnings	725	875	1300	1575
Total Stockholder's equity	1750	1875	2300	2575
Total Liabilities and Stockholder's equity	3850	4475	5150	5850

The following balance sheet is provided for Phoenix Company. Perform a horizontal analysis of the balance sheet in Excel and identify two items that appear to be unusual and could be possible symptoms of fraud. Explain your reasons why the two items could be potential fraud. Balance Sheet 2016 2017 2018 2019 Cash 1000 1300 1500 1600 Accounts Receivable 250 475 700 1000 Inventory 600 725 875 1000 Notes Receivable 2000 1975 2075 2250 Total Assets 3850 4475 5150 5850 Accounts Payable 700 875 975 1125 Other Current Liabilities 200 325 375 450 Notes Payable 1200 1400 1500 1700 Total Liabilities 2100 2600 2850 3275 Stock Outstanding 1000 1000 1000 1000 Retained Earnings 725 875 1300 1575 1750 1875 2300 2575 Total Stockholder's equity 3850 4475 5150 5850 Total Liabilities and Stockholder's equity The following balance sheet is provided for Phoenix Company. Perform a horizontal analysis of the balance sheet in Excel and identify two items that appear to be unusual and could be possible symptoms of fraud. Explain your reasons why the two items could be potential fraud. Balance Sheet 2016 2017 2018 2019 Cash 1000 1300 1500 1600 Accounts Receivable 250 475 700 1000 Inventory 600 725 875 1000 Notes Receivable 2000 1975 2075 2250 Total Assets 3850 4475 5150 5850 Accounts Payable 700 875 975 1125 Other Current Liabilities 200 325 375 450 Notes Payable 1200 1400 1500 1700 Total Liabilities 2100 2600 2850 3275 Stock Outstanding 1000 1000 1000 1000 Retained Earnings 725 875 1300 1575 1750 1875 2300 2575 Total Stockholder's equity 3850 4475 5150 5850 Total Liabilities and Stockholder's equity