In a Manufacturing Company, Which One of the Following Audit

question 64

Multiple Choice

In a manufacturing company, which one of the following audit procedures would give the least assurance about the valuation of inventory at the audit date?

• A)Testing the computation of standard overhead rates.
• B)Examining paid vendors' invoices.
• C)Reviewing direct labor rates.
• D)Obtaining confirmation of inventories pledged under loan agreements.

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Definitions:

Deltoid Tuberosity

A roughened area on the middle of the outer surface of the humerus, where the deltoid muscle attaches.

Obturator Foramen

A large opening in the hip bone formed by the pubic and ischial bones, through which nerves and blood vessels pass.

Acetabulum

The cup-shaped cavity at the base of the hip bone into which the ball-shaped head of the femur fits to form the hip joint.

Inferior Pubic Ramus

The lower branch of the pubic bone, which together with the superior ramus, forms a part of the pelvis.