Practice Assignment Gradebook ORION Downloadable eTextbook signment CALCULATOR F

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Practice Assignment Gradebook ORION Downloadable eTextbook signment CALCULATOR FULL SCREEN PRINTER VERSION BACK NEXT Concept for Analysis 13-7 (Essay) The Dotson Company, owner of Bleacher Mall, charges Rich Clothing Store a rental fee of $600 per month plus 5%of yearly profits over $500,000. Matt Rich, the owner of the store, directs his accountant, Ron Hamilton, to increase the estimate of bad debt expense and warranty costs in order to keep profits at $475,000. (b) Who is harmed if the estimates are increased? Click if you would like to Show Work for this question: Open Show Work Question Attempts: Unlimited SAVE FOR LATER SUBMIT ANSWER

Explanation / Answer

The Datson company is harmed, because mis leading financial statements.

Current stockholder's of Rich clothing store are harmed because the lower net income reduces the current value of holdings.

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