An Auditor Will Usually Trace the Details of the Test

question 37

Multiple Choice

An auditor will usually trace the details of the test counts of inventory items selected from the factory floor while observing the inventory stocktake through to a final inventory schedule.This audit procedure is undertaken to provide evidence of which assertion(s) ?

• A)Valuation and allocation.
• B)Existence.
• C)Completeness.
• D)Cut-off.

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Definitions:

Compounded Quarterly

Interest calculated on an investment or loan on a quarterly basis where the interest is added to the principal, resulting in interest on interest for the next quarter.

Compounded Monthly

Interest calculated on the initial principal and also on the accumulated interest of previous periods, with the process happening every month.

Compounded Semi-annually

Interest calculated on the initial principal, which also includes all of the accumulated interest from previous periods, applied twice a year.

Equivalent Cash

A term typically used to describe a sum of money that has the same value as another form of financial instrument or asset.