Auditors Realize That XYZ Is Experiencing Increasing Levels of Inventory

question 6

Multiple Choice

Auditors realize that XYZ is experiencing increasing levels of inventory while its competitors' inventory levels remain stable. All of the following are likely explanations except:

• A) The increase in inventory is a result of poor management decisions
• B) The increase in inventory is a result of increased sales expectations
• C) The increase in inventory is a result of fraud
• D) All of the above are possible explanations

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Definitions:

Cannabis Use

The act of consuming cannabis, a psychoactive drug, for recreational or medical purposes.

Phencyclidine (PCP)

A dissociative drug known for its mind-altering effects, which can include feelings of detachment from reality and hallucinations.

Intoxication

A state of diminished mental and physical ability resulting from the consumption of alcohol, drugs, or other psychoactive substances.

Perceptual Experiences

Subjective experiences derived from the process of interpreting sensory input from the environment.