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

question 100

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 balance sheet accounts for the current year to the prior year.Investigate changes from the auditor's expectations that appear to be unreasonable.
• B)Calculate the gross 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 D
• G)both B and C

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Definitions:

Proxy

The right to act for another on a specific issue. In finance the right to cast another’s vote in the election of corporate directors. Incumbent directors routinely solicit stockholders’ proxies for reelection.

Voting Rights

The rights possessed by shareholders that allow them to vote on matters of corporate policy, including decisions on the composition of the board of directors.

Market Return

The total return from an investment or portfolio, including dividends and capital gains, as compared to the overall market.

Constant Growth Stock

A stock whose dividends are expected to grow at a constant rate indefinitely.