Evidence collection process in a fraud case Instructions1. Analize the following information:Indirect methods of income from unknown sourcesAssume that the following information is derived from reliable sources: Net WorthLifestyle ApproachIncome from Known SourcesDescriptionAmount AssetLiabilitySourcesApplicationBoat25,000 Boat Loan20,000 Boat Loan Payments5,000 Car40,000 Car Loan40,000 Car Loan Payments2,000 Deposit to bank account400,000 Dividends reported on Tax Retun5,000 Down Payment Boat 12,000 Down payment Car7,000 Down Payment Time share 6,000 Down Payment Vacation home 15,000 House275,000 Home equity loan35,000 Home Equity Loan Payments4,000 Income on Tax Return1,000 Mortgage200,000 Mortgage payments3,000 Mutual funds20,000 Purchase Mutual Funds20,000 Time share50,000 Vacation homes250,000 Wages on the w-2 and tax return75,000 Net Worth Estimated Net Cash Income Estimated income from unknown sources Use the information in the table above .Given income from known sources, estimate the income from unknown sources from a Lifestyle Approach

Income from unknown sources is defined as any income that is not clearly traceable to a specific…

Answered: Use the information in the table above…

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter2: The Auditor’s Responsibilities Regarding Fraud And Mechanisms To Address Fraud: Regulation And Corporate Governance

Section: Chapter Questions

Problem 35RSCQ

Related questions

Question

Evidence collection process in a fraud case

Instructions

1. Analize the following information:

Indirect methods of income from unknown sources Assume that the following information is derived from reliable sources:
		Net Worth	Lifestyle Approach	Income from Known Sources
Description	Amount	Asset	Liability	Sources	Application
Boat	25,000
Boat Loan	20,000
Boat Loan Payments	5,000
Car	40,000
Car Loan	40,000
Car Loan Payments	2,000
Deposit to bank account	400,000
Dividends reported on Tax Retun	5,000
Down Payment Boat	12,000
Down payment Car	7,000
Down Payment Time share	6,000
Down Payment Vacation home	15,000
House	275,000
Home equity loan	35,000
Home Equity Loan Payments	4,000
Income on Tax Return	1,000
Mortgage	200,000
Mortgage payments	3,000
Mutual funds	20,000
Purchase Mutual Funds	20,000
Time share	50,000
Vacation homes	250,000
Wages on the w-2 and tax return	75,000
Net Worth
Estimated Net Cash Income
Estimated income from unknown sources