Your Client Counts Inventory Three Months Before the End of the Fiscal

question 56

Multiple Choice

Your client counts inventory three months before the end of the fiscal year. Internal controls over inventory are excellent. Which procedure is not necessary for the inventory roll-forward?

• A)Check that shipping documents for the last three months agree with perpetual records.
• B)Tracing receiving reports for the last three months to perpetual records.
• C)Compare gross margin percentages for the last three months.
• D)Request the client to recount inventory at the end of the year.

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Definitions:

Implicit Learning

Learning that occurs without explicit awareness of what has been learned.

Analytic Concept Formation

The cognitive process of categorizing or classifying information based on identifiable characteristics or rules.

Nonanalytic

Pertaining to thought processes or problem-solving approaches that do not involve systematic analysis, often relying on intuition or heuristic methods.

Knowledge-Based

Relates to systems or approaches that utilize a comprehensive collection of understanding or data to solve problems.