If the Auditor Selects the Sample of Inventory Items to Count

question 72

Multiple Choice

If the auditor selects the sample of inventory items to count from the inventory on the warehouse shelves,the auditor gathers evidence about which assertion(s) ?

• A)existence and occurrence.
• B)accuracy.
• C)valuation or allocation.
• D)completeness.
• E)presentation and disclosure.

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Definitions:

Socially Efficient

An economic condition where the allocation of resources maximizes social welfare, often where marginal cost meets marginal benefit.

Negative Externalities

Costs that are suffered by a third party as a result of an economic transaction or activity, for which they are not compensated.

Tobacco Industry

The sector of the economy involved in the manufacture, marketing, and sale of tobacco and related products.

Corrective Tax

A tax designed to encourage or discourage certain behaviors to correct for the effects of externalities.