Which One of the Following Procedures Would Not Be Appropriate

question 97

Multiple Choice

Which one of the following procedures would not be appropriate for an auditor in discharging his responsibilities concerning the client's physical inventories?

• A) confirmation of goods in the hands of public warehouses
• B) supervising the taking of the annual physical inventory
• C) carrying out physical inventory procedures at an interim date
• D) obtaining written representation from the client as to the existence, quality, and dollar amount of the inventory

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Definitions:

Equivalent Unit

A concept in cost accounting used to apportion costs to partially completed goods, treating them as a fraction of a fully completed unit.

Process Costing System

An accounting methodology used to allocate costs to units of product in continuous processes or industries where the products are indistinguishable from each other.

Weighted-Average Method

An inventory costing method that calculates the cost of goods based on the average cost of all similar items in inventory.

Processing Department

A specific department within a manufacturing facility where a particular stage of the production process is carried out.