When Labour Is a Material Factor in Inventory Valuation, the Auditor

question 45

Multiple Choice

When labour is a material factor in inventory valuation, the auditor should place special emphasis on testing the internal controls concerning:

• A) authorisation of wage rates.
• B) completeness of recorded transactions.
• C) fictitious employees.
• D) proper classification of transactions.

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Definitions:

Minimum Efficient Scale

The lowest level of output at which a firm can minimize long-run average total cost.

U.S. Agriculture

The sector of the United States economy that deals with the production of plants and animals for food, fiber, and other products.

Farm Share

The portion of the final retail price of agricultural products that goes back to the farmers.

U.S. GDP

U.S. Gross Domestic Product reflects the total monetary or market value of all the finished goods and services produced within the United States' borders in a specific time period.