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According to the case, there are several places should caused Hope to inspect carefully on it. First of all, on the U.S. Surgical Corporation’s Consolidated Income Statements from the year 1979 to 1981, the net sales have dramatically increase from $60,876 in 1979 to $86,214 in 1980 and $111,800 in 1981, each month increase more than one third of original balance, this unusual increase should give Hope big attention to investigate...

Secondly, under the consolidated Balance Sheets, “Molds and Dies” in the property, plant and equipment have also spectacularly more then doubled increase each year. Also, the balance of research and development expense in 1891 compared with previous has more than 50 percent deceased. All of these three points give the Hope, who is the auditor of U...

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