Ratchet Manufacturing anticipates total sales for August, September, and October of $220,000, $230,000, and $240,500 respectively. Cash sales are normally 30% of total sales and the remaining sales are on credit. All credit sales are collected in the first month after the sale. Compute the amount of accounts receivable to be reported on the company's budgeted balance sheet for August.

Greenbloom garden centers is a small, privately held corporation that has two stores in orlando, florida. the greenbloom family owns 100 percent of the company's stock, and family members manage the operations. sales at the company's stores have been growing rapidly, and there appears to be a market for the company's sales concept – providing bulk garden equipment and supplies at low prices. the controller prepares the company's financial statements, which are not audited. the company has no debt but is considering expanding to other cities in florida. such expansion may require long-term borrowings and is likely to reduce the family's day-to-day control of the operations. the family does not intend to sell stock in the company. required: discuss at least three factors that may make an audit necessary and potentially valuable for the company. be sure to consider the concept of information risk.