Which of the Following Procedures Will Usually Be Performed by the Auditor

question 22

Multiple Choice

Which of the following procedures will usually be performed by the auditor to actively determine obsolete inventory?

• A)Confirmation of inventory with customers.
• B)Footing the inventory subsidiary ledger.
• C)Tracing inventory ordered by the client to receiving reports.
• D)Analysis of inventory turnover and sales reports.

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Definitions:

Intangible Asset

An asset that is not physical in nature, such as patents, copyrights, trademarks, and goodwill.

Depreciation Expense

An accounting method of allocating the cost of a tangible asset over its useful life to represent how much of the asset's value has been used.

Estimated Useful Life

The expected period over which an asset is anticipated to be used by a business.

Leasehold

An interest in an asset that gives the holder the right to use it for a specified period of time, typically relating to property or land.