In an Audit of Inventories,an Auditor Would Least Likely Verify

question 65

Multiple Choice

In an audit of inventories,an auditor would least likely verify that

• A) All inventory owned by the client is on hand at the time of the count.
• B) The client has used proper inventory pricing.
• C) The financial statement presentation of inventories is appropriate.
• D) Damaged goods and obsolete items have been properly accounted for.

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Definitions:

Discount Rate

The discount rate is the interest rate used to calculate the present value of future cash flows in discounted cash flow analysis, reflecting the risk and opportunity cost of capital.

Pretax Return

The income an investor or business earns before any taxes are deducted.

Net Present Value

A financial measurement that calculates the value of a project or investment by discounting the expected future cash flows to their present value using a specific discount rate.

Tractor-Trailer

A vehicle configuration consisting of a front tractor unit coupled to a trailer carrying cargo.