In Obtaining an Understanding of a Manufacturing Entity's Internal Control

question 48

Multiple Choice

In obtaining an understanding of a manufacturing entity's internal control concerning inventory balances, an auditor most likely would

• A) Review the entity's description of inventory policies and procedures.
• B) Perform test counts of inventory during the entity's physical count.
• C) Analyze inventory turnover statistics to identify slow-moving and obsolete items.
• D) Analyze monthly production reports to identify variances and unusual transactions.

---

Definitions:

Narcolepsy

A chronic sleep disorder characterized by overwhelming daytime drowsiness and sudden attacks of sleep.

Irregular Brain Waves

Abnormal patterns in the electrical activity of the brain, potentially indicating neurological disorders.

NREM-3 (N3)

The third stage of non-rapid eye movement sleep, characterized by deep sleep and the most difficult stage from which to be awakened.

Delta Waves

Slow brain waves predominantly observed in the deepest stages of sleep, representing a state of unconsciousness and regenerative rest.