Which Analytical Procedure Would Be Most Helpful in Alerting the Auditor

question 28

Multiple Choice

Which analytical procedure would be most helpful in alerting the auditor to the possibility of obsolete inventory? Compare

• A) current year manufacturing costs with previous years' costs.
• B) gross margin percentage with previous years' percentages.
• C) inventory turnover ratio with previous years' ratios.
• D) unit costs of inventory with previous years' costs.

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Definitions:

Intrinsic Motivation

The internal desire to perform a task for its own sake because it is interesting or enjoyable, without relying on external rewards or pressures.

Prejudice

Preconceived opinion or bias against an individual or group without sufficient knowledge, thought, or reason.

Self-esteem

Someone's internal judgement of their own significance or value.

Cognitive Control

The ability of individuals to regulate their own cognitive processes, including their thoughts, attention, and emotions.