For Several Years, an Entity's Physical Inventory Count Has Been

question 52

Multiple Choice

For several years, an entity's physical inventory count has been lower than what was shown on the books at the time of the count so that downward adjustments to the inventory account were required. Contributing to the inventory problem could be weaknesses in internal controls that led to the failure to record some:

• A)purchases returned to vendors.
• B)sales returns received.
• C)sales discounts allowed.
• D)cash purchases.

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Definitions:

Third-party Dispute Resolution

Involves an external, neutral party to help resolve conflicts or disputes between two other parties.

Contract Disputes

Disagreements that arise between parties regarding the terms, interpretation, or execution of a contract.

Public Sector

The portion of the economy composed of government services and state-owned enterprises.

State Lawmakers

are elected officials at the state level responsible for creating and amending state laws and regulations.