Your Audit Client,Banner,is a Retail Sporting Goods Store

question 46

Essay

Your audit client,Banner,is a retail sporting goods store.You are currently working on the inventory portion of the audit.In obtaining audit evidence in support of financial statement assertions,the auditor develops specific audit objectives in response to those assertions.Audit procedures are then selected to accomplish audit objectives.
For each specific inventory audit objective listed,select the most closely related account balance financial statement assertion and the most appropriate audit procedure.Financial statement assertions and audit procedures may be selected once,more than once,or not at all.

$\begin{array}{|l|l}\hline &\text { Specific audit objectives }\\\hline 1 & \text { The entity has legal title to inventories. } \\\hline 2 & \text { Recorded inventory quantities include all products on hand. } \\\hline 3 & \text { Inventories are reduced, when appropriate, to replacement costs or net realizable } \\& \text { value. } \\\hline 4 & \text { Cost of inventories is properly calculated. } \\\hline 5& \begin{array}{l}\text { The major categories of inventories and their basis of valuation are adequately } \\\text { rep orted in the financial statements. }\end{array}\\\hline\end{array}$

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Definitions:

Night Shifts

Work schedules that require individuals to work during the nighttime hours, often involving different challenges and health implications than day shifts.

Toddler Care

The specific practices and provisions designed to cater to the health, safety, and developmental needs of young children aged 1 to 3 years.

Relative Poverty

A condition where individuals or families have considerably less income or resources than the average in their society or community, making it difficult to maintain an average standard of living.

Basic Necessities

Essential items required for living, including food, water, shelter, and clothing, considered fundamental for human survival.