Examining Inventory Descriptions on Tags and Comparing to Actual Inventory

question 58

Multiple Choice

Examining inventory descriptions on tags and comparing to actual inventory relates to which audit objective?

• A) Inventory is counted accurately (accuracy).
• B) Inventory is classified correctly (classification).
• C) Existing inventory is counted and tagged (completeness).
• D) Inventory as recorded on tags exists (existence).

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Definitions:

Liable

Responsible by law; legally answerable for one's actions or inactions.

Personally

Refers to something done by a person directly, without the involvement of anyone else or any intermediaries.

Proper Indorsement

A legally acceptable signature or annotation on a document, such as a check, that authorizes its transfer or acceptance.

Dishonor

The refusal or inability to pay a debt when due, or the failure of a financial instrument, like a check, to be accepted or paid on presentation.