As Part of the Audit of Valuation, the Auditor Is

question 29

Multiple Choice

As part of the audit of valuation, the auditor is conducting pricing tests by comparing to supplier invoices. The auditor is making sure that, for each item tested, sufficient supplier invoices are examined to cover the quantity of inventory that was on hand during the physical inventory count. What type of pricing error could this detect?

• A) the client valued their inventory on the basis of the most recent invoice only
• B) the client has used the incorrect accounting method to value its inventory
• C) extension errors could occur with numerous different inventory items
• D) the wrong inventory count quantity could have been recorded on the count sheets

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Definitions:

Parietal

Relating to the parietal lobes of the brain, which are involved in processing sensory information such as touch, temperature, and body position.

Temporal

Relating to time, or the sequential order in which events occur.

Occipital

Related to the occipital lobe of the brain, which mainly handles the processing of visual information.

Frontal

Pertaining to the frontal lobe of the brain, which is involved in executive functions such as decision-making, problem-solving, and control of behavior.