From Which One of the Following Evidence-Gathering Audit Procedures Would

question 35

Multiple Choice

From which one of the following evidence-gathering audit procedures would an auditor obtain most assurance concerning the existence of inventories?

• A) written inventory representations from management
• B) confirmation of inventories in a public warehouse
• C) observation of physical inventory counts
• D) auditor's recomputation of inventory extensions

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Definitions:

Mutual Funds

Mutual funds are investment vehicles comprised of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments, and other assets.

Abnormal Return

A term in finance that refers to the difference between an actual investment return and the expected return, based on the asset's risk and market movements.

Fourth Quarter Earnings

The financial performance of a company in the final quarter of its fiscal year, often used as an indicator of annual performance.

Beta

A financial metric that measures the volatility of a stock or portfolio in comparison to the market as a whole.