In the Acquisition and Expenditure Process,the Auditor Might Perform the Following

question 30

Multiple Choice

In the acquisition and expenditure process,the auditor might perform the following analytical procedures

• A)Compare accounts payable,accrued liabilities,cost of goods sold,and the balance in all the expense accounts for the current year to the prior year.Investigate changes from the auditor's expectations that appear to be unreasonable.
• B)Calculate the vendor margin percentage for the current and prior years.Investigate any changes from the auditor's expectations that appear to be unreasonable.
• C)Consider the number of vendor accounts for the current year and the prior year and the new vendors added or lost in each year.
• D)Compare accounts payable,accrued liabilities,cost of goods available for sale,and the balance in all the expense accounts for the current year to the prior year.Investigate changes from the auditor's expectations that appear to be unreasonable.
• E)Calculate the merchandize inventory percentage for the current and prior years.Investigate any changes from the auditor's expectations that appear to be unreasonable.
• F)both A and C
• G)both B and D

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Definitions:

Dividend Yield Ratio

A financial ratio that indicates how much a company pays out in dividends each year relative to its stock price.

Market Price

The current price at which an asset or service can be bought or sold in the marketplace.

Stock Split

An action by a company to divide its existing shares into multiple shares to boost the liquidity of the shares.

Par Value

The nominal value per share of stock as specified in the corporate charter; also, another name for bond principal, or the maturity amount of a bond (in Chapter 10).