To Measure How Effectively a Client Employs Its Assets,an Auditor

question 47

Multiple Choice

To measure how effectively a client employs its assets,an auditor calculates inventory turnover by dividing the average inventory into:

• A)Net sales.
• B)Cost of good sold.
• C)Operating income.
• D)Gross sales.

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Definitions:

Unskilled Labor

Labor that requires no specialized skills, education, or training, and typically involves simple tasks that can be easily learned on the job.

Market Wage

The prevailing rate of pay for labor in a particular industry or occupation, determined by the supply and demand for labor in that market.

Government Intervention

Actions taken by a government to influence its economy, which can include regulations, subsidies, and tariffs.

Market Economy

An economic system where supply and demand from private enterprises and consumers dictate the production of goods and services.