The Audit of the Inventory and Warehousing Cycle Will Be

question 145

Essay

The audit of the inventory and warehousing cycle will be affected by the results from other business processes. Identify the "other" business cycles and how they impact the audit of inventory.

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Definitions:

ROE

Return On Equity; a measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.

Operating ROA

A financial ratio that measures the efficiency of a company's operation by dividing its operating income by its total assets.

Net Profit

The amount of income that remains after all expenses, taxes, and costs have been subtracted from total revenue; a key indicator of a company's profitability.

EBIT

Earnings Before Interest and Taxes, a measure of a firm's profit that includes all expenses except interest and income tax expenses.