Question
To determine how risky a particular company is that you are auditing, you prepare these five ratios along with the same ratios of this company's
To determine how risky a particular company is that you are auditing, you prepare these five ratios along with the same ratios of this company's peers:
| Company | Peers | |
| Days's Sales in Receivable Index | 1.51 | 1.05 |
| Gross Margin Index | 1.98 | 1.11 |
| Asset Quality Index | 1.21 | 1.01 |
| Sales Growth Index | 1.53 | 1.19 |
| Total Accruals to Total Assets | 0.11 | 0.06 |
What are your thoughts about the risk potential of this company?
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Management Accounting Information for Decision-Making and Strategy Execution
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young
6th Edition
137024975, 978-0137024971
