If the Auditor Concludes That the Physical Controls Over Inventory

question 39

Multiple Choice

If the auditor concludes that the physical controls over inventory are so inadequate that inventory will be difficult to count,the auditor should

• A)inquire of management the additional controls that can be put in place to enable a better count to be carried out.
• B)conduct additional control tests over the pricing and compilation of inventory to obtain a higher degree of accuracy.
• C)rely on the perpetual inventory master files rather than the physical count.
• D)expand the observation of physical inventory tests to ensure that an adequate count is carried out.

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Definitions:

Flashbulb Memory

An extremely precise and vivid memory of the moment and the surrounding circumstances when one hears surprising, significant, or emotionally stimulating news.

Flashbulb Memory

A highly detailed and vivid memory of an emotionally significant moment or event, which is retained with clarity as if it was a photograph.

Vivid

Producing powerful feelings or strong, clear images in the mind, often used to describe memories or descriptions that are very clear and detailed.

Visuospatial Sketchpad

A part of short-term memory that deals with the handling of visual and spatial data.