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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