Your client is a manufacturer of handheld tools that employs a sales force to market the tools to retail hardware stores. You plan to use substantive analytical procedures to gather persuasive evidence about the reasonableness of commissions expense. The visualization titled Average Commission Rate per Customer has sales and commissions expense data. You can determine whether the relationship between commissions and sales makes sense. If it does, that suggests that commissions expense is fairly stated. The commission policy of the client is as follows: For sales greater than $75,000, commission is 3.75% For sales greater than $50,000, but less than $75,000, commission is 2.5% For sales greater than $25,000, but less than $50,000, commission is 1.25% For sales less than $25,000, commission is 0.5% You can open the Tableau file in this problem statement with Tableau Desktop software. If you do not have a version of Tableau Desktop, you can open the file with Tableau Reader. Tableau Reader is a free download that allows you to open visualizations built with Tableau Desktop. To find a free download of Tableau Reader on the Tableau website, search for Tableau Reader in your internet browser, or click here.

Question:

Using the visualization titled Relationship between Sales and Commissions, what do you think about the reasonableness of commissions expense?

A. Commissions expense appears fairly stated, as it tracks in a reasonable pattern by day with revenue.

B. There is not enough information to make a determination.

C. Commissions expense is likely understated, because the blue like peaks above the orange line a couple of times.

D. Commissions expense is likely overstated, because the orange line is above the blue line in many cases.

Measure Names Relationship between Sales and Commissions Commission Sales before tax 600K 9K 550K 8K 500K 450K 7K 400K 6K 350K Sales before tax wand 5K Commission 300K 4K 250K 200K 3K 150K 2K 100K 1K 50K OK OK Jan 3 Jan 5 Jan 7 Jan 9 Jan 11 Jan 13 Jan 15 Jan 17 Jan 19 Jan 21 Jan 23 Jan 25 Jan 27 Jan 29 Jan 31 Measure Names Relationship between Sales and Commissions Commission Sales before tax 600K 9K 550K 8K 500K 450K 7K 400K 6K 350K Sales before tax wand 5K Commission 300K 4K 250K 200K 3K 150K 2K 100K 1K 50K OK OK Jan 3 Jan 5 Jan 7 Jan 9 Jan 11 Jan 13 Jan 15 Jan 17 Jan 19 Jan 21 Jan 23 Jan 25 Jan 27 Jan 29 Jan 31