Which of the Following Is the Most Appropriate Test for Auditing

question 5

Multiple Choice

Which of the following is the most appropriate test for auditing inventory in the land development and home building industry?

• A) Examine subsequent invoices received in support of estimates of the cost of sales for individual units sold just before year end.
• B) Calculate estimated ending inventory using standards and variance information.
• C) Review sales contracts for bill-and-hold transactions.
• D) All of the above tests are common in the land development and home building industry.

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