If There Is a Risk That Management's Assertion That Recorded

question 53

Multiple Choice

If there is a risk that management's assertion that recorded inventory exists is not valid, the auditor will

• A) spend more time testing for the existence of recorded inventory.
• B) spend less time testing for the existence of recorded inventory.
• C) spend more time testing for the completeness of inventory.
• D) not adjust their audit strategy.

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Definitions:

Markup Percent

The percentage increase in the selling price of goods beyond their cost, used by retailers to achieve a profit margin.

Scaffolding Equipment

the temporary structures and tools used in construction, maintenance, and repair activities to support workers and materials.

Aluminum Extension Ladder

A ladder made of aluminum, designed to extend to various lengths for reaching high places.

Dollar Markup

The difference between the selling price of an item and its cost, expressed in dollars.