When the Client's Physical Inventory Occurs Before the Last Day

question 28

Multiple Choice

When the client's physical inventory occurs before the last day of the year, it is still necessary to perform an accounts payable cutoff at the time of the count. In addition, the auditor must verify whether all acquisitions taking place between the count and the end of the year were added to

• A) the physical inventory.
• B) accounts payable.
• C) accounts payable and cost of goods sold.
• D) the physical inventory and accounts payable.

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Definitions:

Difference Threshold

The smallest amount of change in a stimulus that can be detected as different from the original stimulus.

Subliminal Threshold

The level below which a stimulus is not consciously detected but can still influence thoughts, feelings, or actions.

Stimulation

The action of arousing interest, excitement, or activity in someone or something.

Sensation

The process by which sensory receptors and the nervous system receive and represent stimuli from the environment.