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:

Services

Useful functions, acts, or performances provided by one party to another, often in exchange for payment.

One Buyer

One buyer refers to a market situation where a single customer or entity has significant buying power or is the sole purchaser of a product or service.

Product

An item or service created through a process and offered for sale to satisfy wants or needs of consumers.

Service

Activities or functions provided by one party to another, often in exchange for payment, that do not result in the ownership of anything.