Green,CPA,performed a Mean-Per-Unit Sampling Plan to Examine the Inventory Balances

question 43

Multiple Choice

Green,CPA,performed a mean-per-unit sampling plan to examine the inventory balances of ABC Company.Green audited 120 items from a sample and found an audited value of $24,600.The sample had a recorded value of $30,000.If the entire inventory contained 2,400 items and the total recorded value of the inventory was $480,000,the estimated account balance using mean per unit estimation is

• A) $393,600.
• B) $474,500.
• C) $480,000.
• D) $492,000.

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Definitions:

Goodwill

An intangible asset that arises when a business is purchased for more than the fair value of its separate net assets, representing aspects like brand reputation, customer loyalty, and other non-physical assets.

Balance Sheet

A balance sheet is a financial statement that provides a snapshot of a company's financial condition at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Long-Term Investments

Assets held by a company for a period exceeding one year, intended to bring a return on the investment over time.

Common Stock

Equity securities that represent ownership in a corporation, giving holders voting rights and a share in the company's profits via dividends.