When Testing the Valuation Assertion,the Auditor Would Most Likely

question 36

Multiple Choice

When testing the valuation assertion,the auditor would most likely

• A)confirm inventory on consignment.
• B)examine receiving reports for inventory,tracing them recorded amounts.
• C)observe the taking of physical inventory.
• D)perform price tests to the related cost flow assumption.

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Definitions:

Support Departments

Units within an organization that provide essential services or support to the core operational departments but do not directly contribute to revenue.

Projected Long-Run Needs

Anticipated requirements of a business over an extended period, which influence operational and strategic planning.

Capital Budget

A budget for major capital, or investment, expenditures that are used to acquire or upgrade physical assets such as property and equipment.

Dual Cost Allocation

A method in cost accounting that assigns costs to products or services based on both direct and indirect cost factors.