The external auditor renders an adverse opinion when he/she:

Select one:

a. is unable to express an opinion either way because of a limitation in the work he or she was able to carry out

b. considers that the financial statements are not presented fairly in accordance with GAAP

c. is generally satisfied except for a specified departure from GAAP in the statements

d. none of the above

Banana Ltd has been sued by a competitor for a potential copyright infringement. Legal advice is divided over the likelihood of the success of the claim and the likely damages, if any. How would it be reported?

Select one:

a. As a liability on the balance sheet

b. As an expense on the income statement

c. As a contingent liability in the notes to the accounts

d. It would not be reported anywhere

Based on the below information, calculate the weighted average contribution margin.

	Product A	Product B	Product C
Contribution Margin	$10	$20	$40
Production Ratio	15%	35%	50%

The weighted average contribution margin is:

Select one:

a. $24.5

b. $26.5

c. $28.5

d. $30.5