From the Auditor's Point of View, Inventory Counts Are More

question 2

Multiple Choice

From the auditor's point of view, inventory counts are more acceptable prior to the year-end when:

• A)accurate perpetual inventory records are maintained.
• B)control risk is high.
• C)significant amounts of inventory are held on a consignment basis.
• D)inventory turnover has decreased from the prior year.

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Definitions:

Analysis of Variance

A statistical method used to compare the means of three or more samples to determine if at least one sample mean is significantly different from the others.

Null Hypothesis

A default assumption that there is no significant difference or effect, to be tested against an alternative hypothesis in statistical testing.

Mean Yields

The average outcomes produced or returns obtained from different experiments or investments.

Test Statistic

A measure calculated from sample data to make inferences about a population parameter.