A Public Accountant Observes His Client's Physical Inventory Count on December

question 4

Multiple Choice

A public accountant observes his client's physical inventory count on December 31.There are eight inventory-taking teams and a tag system is used.The public accountant's observation normally may be expected to result in detection of which of the following inventory errors?

• A)The inventory takers forgot to count all the items in one room of the warehouse.
• B)An error is made in the count of one inventory item.
• C)Some of the items included in the inventory had been received on consignment.
• D)The inventory omits items on consignment to wholesalers.

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Definitions:

Organizational Culture

The common ethos, ideologies, and mores that guide the behavior, emotions, and thoughts of staff members in a business setting.

Three-Component Model

A framework that describes an aspect of analysis or understanding composed of three interrelated elements.

Task Expertise

The specific skills, knowledge, and experience required to effectively perform a particular job or task.

Framing Error

Trying to solve a problem in the context in which it is perceived.