The Audit of Year-End Physical Inventories Should Include Steps to Verify

question 91

Multiple Choice

The audit of year-end physical inventories should include steps to verify that the client's purchases and sales cutoffs were adequate. The audit steps should be designed to detect whether merchandise included in the physical count at year-end was not recorded as a

• A) sale in the current period.
• B) sale in the subsequent period.
• C) purchase in the current period.
• D) purchase return in the subsequent period.

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Definitions:

Habituation

The process by which a person or animal becomes accustomed to a stimulus and responds less over time.

Habituation

A psychological learning process wherein there is a decrease in response to a stimulus after being repeatedly exposed to it.

Newborn Infant

An infant who is within the first hours to a few weeks of life, characterized by rapid development and adaptation to the external world.

Habituation

The process of becoming accustomed to a stimulus after repeated exposure, leading to a decrease in response.